text:
A limited partnership shall maintain at its principal office the following information:

(a) A current list showing the full name and last known street and mailing address of each partner, separately identifying the general partners, in alphabetical order, and the limited partners, in alphabetical order;

(b) A copy of the initial certificate of limited partnership and all amendments to and restatements of the certificate, together with signed copies of any powers of attorney under which any certificate, amendment, or restatement has been signed;

(c) A copy of any filed certificate of conversion or merger;

(d) A copy of the limited partnership’s federal, state, and local income tax returns and reports, if any, for the six most recent years;

(e) A copy of any partnership agreement made in a record and any amendment made in a record to any partnership agreement;

(f) A copy of any financial statement of the limited partnership for the six most recent years;

(g) A copy of any record made by the limited partnership during the past three years of any consent given by or vote taken of any partner pursuant to this chapter or the partnership agreement; and

(h) Unless contained in a partnership agreement made in a record, a record stating:

(1) The amount of cash, and a description and statement of the agreed value of the other benefits, contributed and agreed to be contributed by each partner;

(2) The times at which, or events on the happening of which, any additional contributions agreed to be made by each partner are to be made;

(3) For any person that is both a general partner and a limited partner, a specification of what transferable interest the person owns in each capacity; and

(4) Any events upon the happening of which the limited partnership is to be dissolved and its activities wound up.

history: (History: Amended by Stats. 2022, Ch. 617, Sec. 88. (SB 1202) Effective January 1, 2023.)

title: 2. PARTNERSHIPS

article: 1. General Provisions


kind: section

code: CORP

text: A partner may lend money to and transact other business with the limited partnership and has the same rights and obligations with respect to the loan or other transaction as a person that is not a partner.

history: (History: Added by Stats. 2006, Ch. 495, Sec. 20. Effective January 1, 2007. Section operative January 1, 2008, pursuant to Section 15912.04.)

title: 2. PARTNERSHIPS

article: 1. General Provisions

path: 2. PARTNERSHIPS > 4.5. Uniform Limited Partnership Act of 2008 > 1. General Provisions


text: A person may be both a general partner and a limited partner. A person that is both a general and limited partner has the rights, powers, duties, and obligations provided by this chapter and the partnership agreement in each of those capacities. When the person acts as a general partner, the person is subject to the obligations, duties and restrictions under this chapter and the partnership agreement for general partners. When the person acts as a limited partner, the person is subject to the obligations, duties and restrictions under this chapter and the partnership agreement for limited partners.

title: 2. PARTNERSHIPS

chapter: 4.5. Uniform Limited Partnership Act of 2008

article: 1. General Provisions


text:
(a) A limited partnership shall designate and continuously maintain in this state:

(1) an office, which need not be a place of its activity in this state; and

(2) an agent for service of process.

(b) A foreign limited partnership shall designate and continuously maintain in this state an agent for service of process.

(c) An agent for service of process of a limited partnership or foreign limited partnership must be an individual who is a resident of this state or a corporation that has complied with Section 1505 of the Corporations Code and whose capacity to act as an agent has not terminated.

title: 2. PARTNERSHIPS

article: 1. General Provisions


text: Action requiring the consent of partners under this chapter may be taken without a meeting, and a partner may appoint a proxy to consent or otherwise act for the partner by signing an appointment record, either personally or by the partner’s attorney in fact.

title: 2. PARTNERSHIPS

article: 1. General Provisions


text:
(a) In addition to Chapter 4 (commencing with Section 413.10) of Title 5 of Part 2 of the Code of Civil Procedure, process may be served upon limited partnerships and foreign limited partnerships as provided in this section.

(b) Personal service of a copy of any process against the limited partnership or the foreign limited partnership will constitute valid service on the limited partnership if delivered either (1) to any individual designated by it as agent or, if a limited partnership, to any general partner or (2) if the designated agent or, if a limited partnership, general partner is a corporation, to any person named in the latest certificate of the corporate agent filed pursuant to Section 1505 at the office of the corporate agent or to any officer of the general partner, shall constitute valid service on the limited partnership or the foreign limited partnership. No change in the address of the agent for service of process where the agent is an individual or appointment of a new agent for service of process shall be effective (1) for a limited partnership until an amendment to the certificate of limited partnership is filed or (2) for a foreign limited partnership until an amendment to the application for registration is filed. In the case of a foreign limited partnership that has appointed the Secretary of State as agent for service of process by reason of subdivision (b) of Section 15909.07, process shall be delivered by hand to the Secretary of State, or to any person employed in the capacity of assistant or deputy, which shall be one copy of the process for each defendant to be served, together with a copy of the court order authorizing the service and the fee therefor. The order shall include and set forth an address to which the process shall be sent by the Secretary of State.

(c) (1) If an agent for service of process has resigned and has not been replaced or if the agent designated cannot with reasonable diligence be found at the address designated for personal delivery of the process, and it is shown by affidavit to the satisfaction of the court that process against a limited partnership or foreign limited partnership cannot be served with reasonable diligence upon the designated agent or, if a foreign limited partnership, upon any general partner by hand in the manner provided in Section 415.10, subdivision (a) of Section 415.20, or subdivision (a) of Section 415.30 of the Code of Civil Procedure, the court may make an order that the service shall be made upon a domestic limited partnership which has filed a certificate or upon a foreign limited partnership which has a certificate of registration to transact business in this state by delivering by hand to the Secretary of State, or to any person employed in the Secretary of State’s office in the capacity of assistant or deputy, one copy of the process for each defendant to be served, together with a copy of the order authorizing the service. Service in this manner shall be deemed complete on the 10th day after delivery of the process to the Secretary of State.

(2) Upon receipt of any such copy of process and the fee therefor, the Secretary of State shall give notice of the service of the process to the limited partnership or foreign limited partnership, at its principal office, by forwarding to that office, by registered mail with request for return receipt, the copy of the process.

(3) The Secretary of State shall keep a record of all process served upon the Secretary of State under this chapter and shall record therein the time of service and the Secretary of State’s action with reference thereto. A certificate under the Secretary of State’s official seal, certifying to the receipt of process, the giving of notice thereof to the limited partnership or foreign limited partnership, and the forwarding of the process pursuant to this section, shall be competent and prima facie evidence of the matters stated therein.

(d) (1) The certificate of a limited partnership and the application for a certificate of registration of a foreign limited partnership shall designate, as the agent for service of process, an individual residing in this state or a corporation which has complied with Section 1505 and whose capacity to act as an agent has not terminated. If an individual is designated, the statement shall set forth that person’s complete business or residence street address in this state. If a corporate agent is designated, no address for it shall be set forth.

(2) An agent designated for service of process may deliver to the Secretary of State, on a form prescribed by the Secretary of State for filing, a signed and acknowledged written statement of resignation as an agent for service of process containing the name of the limited partnership, the Secretary of State’s file number for the limited partnership, the name of the resigning agent for service of process, and a statement that the agent is resigning. Thereupon the authority of the agent to act in that capacity shall cease and the Secretary of State forthwith shall mail or otherwise provide written notice of the filing of the statement of resignation to the limited partnership or foreign limited partnership at its designated office.

(3) The resignation of an agent may be effective if, on a form prescribed by the Secretary of State containing the name of the limited partnership, the Secretary of State’s file number for the limited partnership, and the name of the agent for service of process, the agent disclaims having been properly appointed as the agent.

(4) The Secretary of State may destroy or otherwise dispose of any statement of resignation filed pursuant to this section after an amended certificate of limited partnership or amended foreign limited partnership registration is filed pursuant to Section 15902.02 or 15909.06 replacing the agent for service of process that has resigned.

(5) If an individual who has been designated agent for service of process dies or resigns or no longer resides in the state or if the corporate agent for that purpose, resigns, dissolves, withdraws from the state, forfeits its right to transact intrastate business, has its corporate rights, powers, and privileges suspended or ceases to exist, (A) the limited partnership shall promptly file an amendment to the certificate designating a new agent or (B) the foreign limited partnership shall promptly file an amendment to the application for registration.

(e) In addition to any other discovery rights which may exist, in any case pending in a California court having jurisdiction in which a party seeks records from a partnership formed under this chapter, whether or not the partnership is a party, the court shall have the power to order the production in California of the books and records of the partnership on the terms and conditions that the court deems appropriate.

history: (History: Amended by Stats. 2014, Ch. 834, Sec. 22. (SB 1041) Effective January 1, 2015.)

title: 2. PARTNERSHIPS

article: 1. General Provisions


text:
(a) A partner may, in a written partnership agreement or other writing, consent to be subject to the nonexclusive jurisdiction of the courts of a specified jurisdiction, or the exclusive jurisdiction of the courts of this state.

(b) If a partner desires to use the arbitration process, that partner may in a written partnership agreement or other writing, consent to be nonexclusively subject to arbitration in a specified state, or to be exclusively subject to arbitration in this state.

(c) Along with this consent to the jurisdiction of courts or arbitration, a partner may consent to be served with legal process in the manner prescribed in the partnership agreement or other writing.

title: 2. PARTNERSHIPS

article: 1. General Provisions


text:
(a) In order for a limited partnership to be formed, a certificate of limited partnership must be filed with and on a form prescribed by the Secretary of State and, either before or after the filing of a certificate of limited partnership, the partners shall have entered into a partnership agreement. The certificate must state:

(1) the name of the limited partnership, which shall comply with Section 15901.08;

(2) the street address of the initial principal office;

(3) the name and street address of the initial agent for service of process in accordance with paragraph (1) of subdivision (d) of Section 15901.16;

(4) the name and the address of each general partner; and

(5) the mailing address of the limited partnership, if different from the address of the initial principal office.

(b) A certificate of limited partnership may also contain any other matters but may not vary or otherwise affect the provisions specified in subdivision (b) of Section 15901.10 in a manner inconsistent with that section.

(c) A limited partnership is formed when the Secretary of State files the certificate of limited partnership.

(d) Subject to subdivision (b), if any provision of a partnership agreement is inconsistent with the filed certificate of limited partnership or with a filed certificate of dissociation, cancellation, or amendment or filed certificate of conversion or merger:

(1) the partnership agreement prevails as to partners and transferees; and

(2) the filed certificate of limited partnership, certificate of dissociation, cancellation, or amendment or filed certificate of conversion or merger prevails as to persons, other than partners and transferees, that reasonably rely on the filed record to their detriment.

(e) A limited partnership may record in the office of the county recorder of any county in this state a certified copy of the certificate of limited partnership, or any amendment thereto, which has been filed by the Secretary of State. A foreign limited partnership may record in the office of the county recorder of any county in the state a certified copy of the application for registration to transact business, together with the certificate of registration, referred to in Section 15909.02, or any amendment thereto, which has been filed by the Secretary of State. The recording shall create a conclusive presumption in favor of any bona fide purchaser or encumbrancer for value of the partnership real property located in the county in which the certified copy has been recorded, that the persons named as general partners therein are the general partners of the partnership named and that they are all of the general partners of the partnership.

(f) The Secretary of State may cancel the filing of certificates of limited partnership, including certificates effecting a conversion, if a check or other remittance accepted in payment of the filing fee is not paid upon presentation. For partners and transferees, the partnership agreement is paramount. Within 90 days of receiving written notification that the item presented for payment has not been honored for payment, the Secretary of State shall give a first written notice of the applicability of this section to the agent for service of process or to the person submitting the instrument. Thereafter, if the amount has not been paid by cashier’s check or equivalent, the Secretary of State shall give a second written notice of cancellation and the cancellation shall thereupon be effective. The second notice shall be given 20 days or more after the first notice.

(g) The Secretary of State shall include with instructional materials, provided in conjunction with the form for filing a certificate of limited partnership under subdivision (a), a notice that the filing of the certificate of limited partnership will obligate the limited partnership to pay an annual tax for that taxable year to the Franchise Tax Board pursuant to Section 17935 of the Revenue and Taxation Code. That notice shall be updated annually to specify the dollar amount of the annual tax.

history: (History: Amended by Stats. 2022, Ch. 617, Sec. 89. (SB 1202) Effective January 1, 2023.)

title: 2. PARTNERSHIPS

path: 2. PARTNERSHIPS > 4.5. Uniform Limited Partnership Act of 2008 > 2. Formation; Certificate of Limited Partnership and Other Filings


text:
(a) In order to amend its certificate of limited partnership, a limited partnership must deliver to and on a form prescribed by the Secretary of State for filing an amendment stating:

(1) the name and the Secretary of State’s file number of the limited partnership; and

(2) the changes the amendment makes to the certificate as most recently amended or restated.

(b) A limited partnership shall promptly deliver to the Secretary of State for filing an amendment to a certificate of limited partnership to reflect:

(1) the admission of a new general partner;

(2) the dissociation of a person as a general partner; or

(3) the appointment of a person to wind up the limited partnership’s activities under subdivisions (c) or (d) of Section 15908.03.

(c) A general partner that knows that any information in a filed certificate of limited partnership was false when the certificate was filed or has become false due to changed circumstances shall promptly:

(1) cause the certificate to be amended; or

(2) if appropriate, deliver to the Secretary of State for filing an amendment or a certificate of correction pursuant to Section 15902.07.

(d) A certificate of limited partnership may be amended at any time for any other proper purpose as determined by the limited partnership.

(e) A restated certificate of limited partnership may be delivered to and on a form prescribed by the Secretary of State for filing in the same manner as an amendment.

(1) A restated certificate of limited partnership may be filed that embodies all of the provisions that are in effect contained in the different certificates that have been filed with the Secretary of State.

(2) A restated certificate of limited partnership may include an amendment of the certificate of limited partnership not previously filed with the Secretary of State.

(3) The restated certificate of limited partnership shall supersede the initial certificate of limited partnership and all amendments thereto previously filed with the Secretary of State.

(4) Any amendment effected in connection with the restatement of the certificate of limited partnership shall be subject to any other provision of this chapter not inconsistent with this section that would apply if a separate certificate of amendment were filed to effect that amendment.

(f) Subject to subdivision (c) of Section 15902.06, an amendment or restated certificate is effective when filed by the Secretary of State.

title: 2. PARTNERSHIPS

article: 2. Formation; Certificate of Limited Partnership and Other Filings


text:
A dissolved limited partnership that has completed winding up shall deliver to and on a form prescribed by the Secretary of State for filing a certificate of cancellation that states:

(1) the name of the limited partnership and the Secretary of State’s file number;

(2) the date of filing of its initial certificate of limited partnership; and

(3) any other information as determined by the general partners filing the certificate or by a person appointed pursuant to subdivisions (c) or (d) of Section 15908.03.

title: 2. PARTNERSHIPS


text:
(a) Each record delivered to the Secretary of State for filing pursuant to this chapter must be signed in the following manner:

(1) An initial certificate of limited partnership must be signed by all general partners listed in the certificate.

(2) An amendment designating as general partner a person admitted under paragraph (2) of subdivision (c) of Section 15908.01 following the dissociation of a limited partnership’s last general partner must be signed by that person.

(3) An amendment required by subdivision (c) of Section 15908.03 following the appointment of a person to wind up the dissolved limited partnership’s activities must be signed by that person.

(4) Any other amendment must be signed by:

(A) at least one general partner listed in the certificate of limited partnership;

(B) each other person designated in the amendment as a new general partner; and

(C) each person that the amendment indicates has dissociated as a general partner, unless:

(i) the person is deceased or a guardian or general conservator has been appointed for the person and the amendment so states; or

(ii) the person has previously delivered to the Secretary of State for filing a certificate of dissociation.

(5) A restated certificate of limited partnership must be signed by at least one general partner listed in the certificate, and, to the extent the restated certificate effects a change under any other paragraph of this subdivision, the restated certificate must be signed in a manner that satisfies that paragraph.

(6) A certificate of cancellation must be signed by all general partners listed in the certificate of limited partnership or, if the certificate of limited partnership of a dissolved limited partnership lists no general partners, by the person appointed pursuant to subdivisions (c) or (d) of Section 15908.03 to wind up the dissolved limited partnership’s activities.

(7) Certificates of conversion must be signed as provided in subdivision (b) of Section 15911.06.

(8) Certificates of merger must be signed as provided in subdivision (a) of Section 15911.14.

(9) A certificate of correction shall be executed in the same manner in which the record being corrected was required to be executed.

(10) Any other record delivered on behalf of a limited partnership to the Secretary of State for filing must be signed by at least one general partner listed in the certificate of limited partnership.

(11) A certificate of dissociation by a person pursuant to paragraph (4) of subdivision (a) of Section 15906.05 stating that the person has dissociated as a general partner must be signed by that person.

(12) A certificate of withdrawal by a person pursuant to Section 15903.06 must be signed by that person.

(13) A record delivered on behalf of a foreign limited partnership to the Secretary of State for filing must be signed by at least one general partner of the foreign limited partnership.

(14) Any other record delivered on behalf of any person to the Secretary of State for filing must be signed by that person.

(b) Any person may sign by an attorney in fact any record to be filed pursuant to this chapter.

(c) The Secretary of State shall not be required to verify that the person withdrawing or dissociating was ever actually named in an official filing as a general or limited partner.

history: (History: Amended by Stats. 2014, Ch. 834, Sec. 24. (SB 1041) Effective January 1, 2015.)

title: 2. PARTNERSHIPS


text:
(a) If a person required by this chapter to sign a record or deliver a record to the Secretary of State for filing does not do so, any other person that is aggrieved may petition the superior court to order:

(1) the person to sign the record;

(2) deliver the record to the Secretary of State for filing; or

(3) the Secretary of State to file the record unsigned.

(b) If the person aggrieved under subdivision (a) is not the limited partnership or foreign limited partnership to which the record pertains, the aggrieved person shall make the limited partnership or foreign limited partnership a party to the action. A person aggrieved under subdivision (a) may seek the remedies provided in subdivision (a) in the same action in combination or in the alternative. In any action under this subdivision, if the court finds the failure of the person to comply with the requirement to sign a record or deliver a record to the Secretary of State for filing to have been without justification, the court may award an amount sufficient to reimburse the persons aggrieved under subdivision (a) bringing the action for the reasonable expenses incurred by such persons, including attorneys’ fees, in connection with the action or proceeding.

(c) A record filed unsigned pursuant to this section is effective without being signed.

(d) Any person, other than a general partner, delivering a record to the Secretary of State for filing, shall state the statutory authority for such action after the signature on the appropriate record.

title: 2. PARTNERSHIPS


text:
(a) A record authorized or required to be delivered to the Secretary of State for filing under this chapter must be completed on a form prescribed by and in a medium permitted by the Secretary of State, and be delivered to the Secretary of State. Unless the Secretary of State determines that a record does not comply with the filing requirements of this chapter, and if all requisite fees have been paid, the Secretary of State shall file the record.

(b) Except as otherwise provided in Sections 15901.16, 15902.01, and 15902.07, a record delivered to the Secretary of State for filing under this chapter may specify an effective time and a delayed effective date. Except as otherwise provided in this chapter, a record filed by the Secretary of State is effective:

(1) if the record does not specify a delayed effective date, on the date the record is filed as evidenced by the Secretary of State’s endorsement of the date on the record;

(2) if the record specifies a delayed effective date on the earlier of:

(A) the specified date; or

(B) the 90th day after the record is filed; or

(c) In case a delayed effective date is specified, the record may be prevented from becoming effective by a certificate stating that by appropriate action it has been revoked and is null and void, executed in the same manner as the original record and delivered to the Secretary of State for filing before the specified effective date. In the case of certificate of merger, a certificate revoking the earlier filing need only be executed on behalf of one of the constituent parties to the merger. If no such revocation certificate is filed, the record becomes effective on the date specified.

(d) If the Secretary of State determines that a record delivered to the Secretary of State for filing does not conform to the law and returns it to the person delivering it, the record may be resubmitted accompanied by a written opinion of the member of the State Bar of California delivering the record or representing the person delivering it, to the effect that the specific provisions of the record objected to by the Secretary of State do conform to law and stating the points and authorities upon which the opinion is based. The Secretary of State shall rely, with respect to any disputed point of law, other than the application of Sections 15901.08, 15901.09, 15909.02, and 15909.05, upon that written opinion in determining whether the record conforms to law. When filed by the Secretary of State upon resubmission, such record is effective retroactively as of the date that the original record was delivered to the Secretary of State for filing.

title: 2. PARTNERSHIPS


text:
(a) A limited partnership or foreign limited partnership may deliver to and on a form prescribed by the Secretary of State for filing a certificate of correction containing the name of the limited partnership or foreign limited partnership and the Secretary of State’s file number for the limited partnership or foreign limited partnership to correct a record previously delivered by the limited partnership or foreign limited partnership to the Secretary of State and filed by the Secretary of State, if at the time of filing the record contained false or erroneous information or was defectively signed.

(b) A certificate of correction may not state a delayed effective date and must:

(1) describe the record to be corrected, including its filing date and file number;

(2) specify the incorrect information and the reason it is incorrect or the manner in which the signing was defective; and

(3) correct the incorrect information or defective signature.

(c) When filed by the Secretary of State, a certificate of correction is effective retroactively as of the effective date of the record the certificate corrects, but the certificate is effective when filed:

(1) for the purposes of subdivisions (c) and (d) of Section 15901.03; and

(2) as to persons relying on the uncorrected record and adversely affected by the correction.

history: (History: Amended by Stats. 2014, Ch. 834, Sec. 25. (SB 1041) Effective January 1, 2015.)

title: 2. PARTNERSHIPS


text:
(a) If a record delivered to the Secretary of State for filing under this chapter and filed by the Secretary of State contains false information, a person that suffers loss by reliance on the information may recover damages for the loss from:

(1) a person that signed the record, or caused another to sign it on the person’s behalf, and knew the information to be false at the time the record was signed; and

(2) a general partner that has notice that the information was false when the record was filed or has become false because of changed circumstances, if the general partner has notice for a reasonably sufficient time before the information is relied upon to enable the general partner to effect an amendment under Section 15902.02, file a petition pursuant to Section 15902.05, or deliver to the Secretary of State for filing a certificate of correction pursuant to Section 15902.07.

(b) Signing a record authorized or required to be filed under this chapter constitutes an affirmation under the penalties of perjury that the facts stated in the record are true.

title: 2. PARTNERSHIPS


text:
(a) A domestic limited partnership whose certificate of limited partnership has been canceled pursuant to Section 15902.03 may be revived by filing with, and on a form prescribed by, the Secretary of State a certificate of revival. The certificate of revival shall be accompanied by written confirmation by the Franchise Tax Board that all of the following have occurred:

(1) All of the following have been paid to the Franchise Tax Board:

(A) The annual tax due under Section 17935 of the Revenue and Taxation Code.

(B) All fees, penalties, and interest for each year for which the domestic limited partnership failed to pay such annual tax, including each year between the cancellation of its certificate of limited partnership and its revival.

(2) All required tax returns have been filed, including returns for each taxable year between the cancellation of its certificate of limited partnership and its revival.

(b) The certificate of revival shall set forth all of the following:

(1) The name of the limited partnership at the time its certificate of limited partnership was canceled, and if the name is not available at the time of revival, the name under which the limited partnership is to be revived.

(2) The date of filing of the original certificate of limited partnership.

(3) The address of the limited partnership’s principal office.

(4) The name and address of the initial agent for service of process in accordance with paragraph (1) of subdivision (d) of Section 15901.16.

(5) A statement that the certificate of revival is filed by one or more general partners of the limited partnership authorized to execute and file the certificate of revival to revive the limited partnership.

(6) The Secretary of State’s file number for the original limited partnership.

(7) The name and address of each general partner.

(8) Any other matters the general partner or partners executing the certificate of revival determine to include therein.

(c) The certificate of revival should be deemed to be an amendment to the certificate of limited partnership, and the limited partnership shall not be required to take any further action to amend its certificate of limited partnership pursuant to Section 15902.02 with respect to the matter set forth in the certificate of revival.

(d) Upon the filing of the certificate of revival, the limited partnership shall be revived with the same force and effect as if the certificate of limited partnership had not been canceled pursuant to Section 15902.03. The revival shall validate all contracts, acts, matters, and things made, done, and performed by the limited partnership, its partners, employees, and agents following the time its certificate of limited partnership was canceled pursuant to Section 15902.03 with the same force and effect and all intents and purposes as if the certificate of limited partnership had remained in full force and effect. This provision shall apply provided that third parties are relying on the acts of the partnership, its partners, employees, and agents. All real and personal property, and all rights and interests, that belong to a limited partnership at the time its certificate of limited partnership was canceled pursuant to Section 15902.03 or that were acquired by the limited partnership following the cancellation of the certificate of limited partnership, that were not disposed of before the time of its revival, shall be vested in the limited partnership after its revival as fully as if they were held by the limited partnership at, and during the time after, as the case may be, the time the certificate of limited partnership was canceled. After its revival, the limited partnership and its partners shall have all of the same liability for contracts, acts, matters, and things made, done, or performed in the limited partnership’s name and on behalf of its partners, employees, and agents, as the limited partnership and its partners would have had if the limited partnership’s certificate of limited partnership had at all times remained in full force and effect.

(e) The amendments made to this section by the act adding this subdivision shall apply to written confirmations made by the Franchise Tax Board on or after January 1, 2010.

history: (History: Amended by Stats. 2022, Ch. 617, Sec. 90. (SB 1202) Effective January 1, 2023.)

title: 2. PARTNERSHIPS


text:
A person becomes a limited partner:

(a) as provided in the partnership agreement;

(b) as the result of a conversion or merger under Article 11 (commencing with Section 15911.01); or

(c) with the consent of all the partners.

title: 2. PARTNERSHIPS

article: 3. Limited Partners

path: 2. PARTNERSHIPS > 4.5. Uniform Limited Partnership Act of 2008 > 3. Limited Partners


text: A limited partner does not have the right or the power as a limited partner to act for or bind the limited partnership.

title: 2. PARTNERSHIPS

article: 3. Limited Partners


text:
(a) A limited partner is not liable for any obligation of a limited partnership unless named as a general partner in the certificate or, in addition to exercising the rights and powers of a limited partner, the limited partner participates in the control of the business. If a limited partner participates in the control of the business without being named as a general partner, that partner may be held liable as a general partner only to persons who transact business with the limited partnership with actual knowledge of that partner’s participation in control and with a reasonable belief, based upon the limited partner’s conduct, that the partner is a general partner at the time of the transaction. Nothing in this chapter shall be construed to affect the liability of a limited partner to third parties for the limited partner’s participation in tortious conduct.

(b) A limited partner does not participate in the control of the business within the meaning of subdivision (a) solely by doing, attempting to do, or having the right or power to do, one or more of the following:

(1) Being any of the following:

(A) An independent contractor for, an agent or employee of, or transacting business with, the limited partnership or a general partner of the limited partnership.

(B) An officer, director, or shareholder of a corporate general partner of the limited partnership.

(C) A member, manager, or officer of a limited liability company that is a general partner of the limited partnership.

(D) A limited partner of a partnership that is a general partner of the limited partnership.

(E) A trustee, administrator, executor, custodian, or other fiduciary or beneficiary of an estate or trust that is a general partner.

(F) A trustee, officer, adviser, shareholder, or beneficiary of a business trust that is a general partner.

(2) Consulting with and advising a general partner with respect to the business of the limited partnership.

(3) Acting as surety for the limited partnership or for a general partner, guaranteeing one or more specific debts of the limited partnership, providing collateral for the limited partnership or general partner, borrowing money from the limited partnership or a general partner, or lending money to the limited partnership or a general partner.

(4) Approving or disapproving an amendment to the partnership agreement.

(5) Voting on, proposing, or calling a meeting of the partners.

(6) Winding up the partnership pursuant to Section 15908.03.

(7) Executing and filing a certificate pursuant to Section 15902.05, a certificate of withdrawal pursuant to paragraph (4) of subdivision (a) of Section 15902.04, or a certificate of cancellation of the certificate of limited partnership pursuant to paragraph (6) of subdivision (a) of Section 15902.04.

(8) Serving on an audit committee or committee performing the functions of an audit committee.

(9) Serving on a committee of the limited partnership or the limited partners for the purpose of approving actions of the general partner.

(10) Calling, requesting, attending, or participating at any meeting of the partners or the limited partners.

(11) Taking any action required or permitted by law to bring, pursue, settle, or terminate a derivative action on behalf of the limited partnership.

(12) Serving on the board of directors or a committee of, consulting with or advising, being or acting as an officer, director, stockholder, partner, member, manager, agent, or employee of, or being or acting as a fiduciary for, any person in which the limited partnership has an interest.

(13) Exercising any right or power permitted to limited partners under this chapter and not specifically enumerated in this subdivision.

(c) The enumeration in subdivision (b) does not mean that any other conduct or the possession or exercise of any other power by a limited partner constitutes participation by the limited partner in the control of the business of the limited partnership.

history: (History: Amended by Stats. 2007, Ch. 130, Sec. 43. Effective January 1, 2008.)

title: 2. PARTNERSHIPS

article: 3. Limited Partners


text:
(a) On 10 days’ demand, made in a record received by the limited partnership, a limited partner may inspect and copy any information required to be maintained pursuant to Section 15901.11 during regular business hours in the limited partnership’s principal office. The limited partner need not have any particular purpose for seeking the information.

(b) Subject to subdivision (g), during regular business hours and at a reasonable location specified by the limited partnership, a limited partner may obtain from the limited partnership, which may be transmitted via electronic transmission, and inspect and copy true and full information regarding the state of the activities and financial condition of the limited partnership and other information regarding the activities of the limited partnership as is just and reasonable if:

(1) the limited partner seeks the information for a purpose reasonably related to the partner’s interest as a limited partner;

(2) the limited partner makes a demand in a record received by the limited partnership, describing with reasonable particularity the information sought and the purpose for seeking the information; and

(3) the information sought is directly connected to the limited partner’s purpose.

(c) Within 10 days after receiving a demand pursuant to subdivision (b), the limited partnership in a record shall inform the limited partner that made the demand:

(1) what information the limited partnership will provide in response to the demand;

(2) when and where the limited partnership will provide the information; and

(3) if the limited partnership declines to provide any demanded information, the limited partnership’s reasons for declining.

(d) Subject to subdivision (f), a person dissociated as a limited partner may inspect and copy required information during regular business hours in the limited partnership’s principal office if:

(1) the information pertains to the period during which the person was a limited partner;

(2) the person seeks the information in good faith; and

(3) the person meets the requirements of subdivision (b).

(e) The limited partnership shall respond to a demand made pursuant to subdivision (d) in the same manner as provided in subdivision (c).

(f) If a limited partner dies, Section 15907.04 applies.

(g) The limited partnership shall have the right to keep confidential from limited partners for such period of time as the limited partnership deems reasonable, any information which the limited partnership reasonably believes to be in the nature of trade secrets or other information the disclosure of which the limited partnership in good faith believes is not in the best interest of the limited partnership or could damage the limited partnership or its business or which the limited partnership is required by law or by agreement with a third party to keep confidential.

(h) The limited partnership may impose reasonable restrictions on the use of information obtained under this section. In a dispute concerning the reasonableness of a restriction under this subdivision, the limited partnership has the burden of proving reasonableness.

(i) A limited partnership may charge a person that makes a demand under this section reasonable costs of copying, limited to the costs of labor and material.

(j) Whenever this chapter or a partnership agreement provides for a limited partner to give or withhold consent to a matter, before the consent is given or withheld, the limited partnership shall, without demand, provide the limited partner with all information material to the limited partner’s decision that the limited partnership knows.

(k) A limited partner or person dissociated as a limited partner may exercise the rights under this section through an attorney or other agent. Any restriction imposed under subdivision (g), subdivision (h) or by the partnership agreement applies both to the attorney or other agent and to the limited partner or person dissociated as a limited partner.

(l) The rights stated in this section do not extend to a person as transferee, but may be exercised by the legal representative of an individual under legal disability who is a limited partner or person dissociated as a limited partner.

history: (History: Amended by Stats. 2022, Ch. 617, Sec. 91. (SB 1202) Effective January 1, 2023.)

title: 2. PARTNERSHIPS

article: 3. Limited Partners


text:
(a) A limited partner does not have any fiduciary duty to the limited partnership or to any other partner solely by reason of being a limited partner.

(b) A limited partner shall discharge the duties to the partnership and the other partners under this chapter or under the partnership agreement and exercise any rights consistently with the obligation of good faith and fair dealing.

(c) A limited partner does not violate a duty or obligation under this chapter or under the partnership agreement merely because the limited partner’s conduct furthers the limited partner’s own interest.

title: 2. PARTNERSHIPS

article: 3. Limited Partners


text:
(a) Except as otherwise provided in subdivision (b), a person that makes an investment in a business enterprise and erroneously but in good faith believes that the person has become a limited partner in the enterprise is not liable for the enterprise’s obligations by reason of making the investment, receiving distributions from the enterprise, or exercising any rights of or appropriate to a limited partner, if, on ascertaining the mistake, the person:

(1) causes an appropriate certificate of limited partnership, amendment, or certificate of correction to be signed and delivered to the Secretary of State for filing; or

(2) withdraws from future participation as an owner in the enterprise by signing and delivering to and on a form prescribed by the Secretary of State for filing a certificate of withdrawal containing the name of the limited partnership and the Secretary of State’s file number of the limited partnership under this section.

(b) A person that makes an investment described in subdivision (a) is liable to the same extent as a general partner to any third party that enters into a transaction with the enterprise, believing in good faith that the person is a general partner, before the Secretary of State files a certificate of withdrawal, certificate of limited partnership, amendment, or certificate of correction to show that the person is not a general partner.

(c) If a person makes a diligent effort in good faith to comply with paragraph (1) of subdivision (a) and is unable to cause the appropriate certificate of limited partnership, amendment, or certificate of correction to be signed and delivered to the Secretary of State for filing, the person has the right to withdraw from the enterprise pursuant to paragraph (2) of subdivision (a) even if the withdrawal would otherwise breach an agreement with others that are or have agreed to become co-owners of the enterprise.

history: (History: Amended by Stats. 2014, Ch. 834, Sec. 26. (SB 1041) Effective January 1, 2015.)

title: 2. PARTNERSHIPS

article: 3. Limited Partners


text:
(a) The partnership agreement may provide for the creation of classes of limited partners. The partnership agreement shall define the rights, powers, and duties of those classes, including rights, powers, and duties senior to other classes of limited partners.

(b) The partnership agreement may provide to all or certain specified classes of limited partners the right to vote separately or with all or any class or the general partners on any matter.

title: 2. PARTNERSHIPS

article: 3. Limited Partners


text:
A person becomes a general partner:

(a) as provided in the partnership agreement:

(b) under paragraph (2) of subdivision (c) of Section 15908.01 following the dissociation of a limited partnership’s last general partner;

(c) as the result of a conversion or merger under Article 11 (commencing with Section 15911.01); or

(d) with the consent of all the partners.

title: 2. PARTNERSHIPS

article: 4. General Partners

path: 2. PARTNERSHIPS > 4.5. Uniform Limited Partnership Act of 2008 > 4. General Partners


text:
(a) Each general partner is an agent of the limited partnership for the purposes of its activities. An act of a general partner, including the signing of a record in the partnership’s name, for apparently carrying on in the ordinary course the limited partnership’s activities or activities of the kind carried on by the limited partnership binds the limited partnership, unless the general partner did not have authority to act for the limited partnership in the particular matter and the person with which the general partner was dealing knew, had received a notification, or had notice under subdivision (d) of Section 15901.03 that the general partner lacked authority.

(b) An act of a general partner which is not apparently for carrying on in the ordinary course the limited partnership’s activities or activities of the kind carried on by the limited partnership binds the limited partnership only if the act was actually authorized by all the other partners.

title: 2. PARTNERSHIPS

article: 4. General Partners


text:
(a) A limited partnership is liable for loss or injury caused to a person, or for a penalty incurred, as a result of a wrongful act or omission, or other actionable conduct, of a general partner acting in the ordinary course of activities of the limited partnership or with authority of the limited partnership.

(b) If, in the course of the limited partnership’s activities or while acting with authority of the limited partnership, a general partner receives or causes the limited partnership to receive money or property of a person not a partner, and the money or property is misapplied by a general partner, the limited partnership is liable for the loss.

title: 2. PARTNERSHIPS

article: 4. General Partners


text:
(a) Except as otherwise provided in subdivision (b), all general partners are liable jointly and severally for all obligations of the limited partnership unless otherwise agreed by the claimant or provided by law.

(b) A person that becomes a general partner of an existing limited partnership is not personally liable for an obligation of a limited partnership incurred before the person became a general partner.

title: 2. PARTNERSHIPS

article: 4. General Partners


text:
(a) To the extent not inconsistent with Section 15904.04, a general partner may be joined in an action against the limited partnership or named in a separate action.

(b) A judgment against a limited partnership is not by itself a judgment against a general partner. A judgment against a limited partnership may not be satisfied from a general partner’s assets unless there is also a judgment against the general partner.

(c) A judgment creditor of a general partner may not levy execution against the assets of the general partner to satisfy a judgment based on a claim against the limited partnership, unless the partner is personally liable for the claim under Section 15904.04 and:

(1) a judgment based on the same claim has been obtained against the limited partnership and a writ of execution on the judgment has been returned unsatisfied in whole or in part;

(2) the limited partnership is a debtor in bankruptcy;

(3) the general partner has agreed that the creditor need not exhaust limited partnership assets;

(4) a court grants permission to the judgment creditor to levy execution against the assets of a general partner based on a finding that limited partnership assets subject to execution are clearly insufficient to satisfy the judgment, that exhaustion of limited partnership assets is excessively burdensome, or that the grant of permission is an appropriate exercise of the court’s equitable powers; or

(5) liability is imposed on the general partner by law or contract independent of the existence of the limited partnership.

title: 2. PARTNERSHIPS

article: 4. General Partners


text:
(a) Each general partner has equal rights in the management and conduct of the limited partnership’s activities. Except as expressly provided in this chapter, any matter relating to the activities of the limited partnership may be exclusively decided by the general partner or, if there is more than one general partner, by a majority of the general partners.

(b) The consent of each partner is necessary to:

(1) amend the partnership agreement; and

(2) sell, lease, exchange, or otherwise dispose of all, or substantially all, of the limited partnership’s property, with or without the good will, other than in the usual and regular course of the limited partnership’s activities.

(c) A limited partnership shall reimburse a general partner for payments made and indemnify a general partner for liabilities incurred by the general partner in the ordinary course of the activities of the partnership or for the preservation of its activities or property.

(d) A limited partnership shall reimburse a general partner for an advance to the limited partnership beyond the amount of capital the general partner agreed to contribute.

(e) A payment or advance made by a general partner which gives rise to an obligation of the limited partnership under subdivision (c) or (d) constitutes a loan to the limited partnership which accrues interest from the date of the payment or advance.

(f) A general partner is not entitled to remuneration for services performed for the partnership.

title: 2. PARTNERSHIPS

article: 4. General Partners


text:
(a) A general partner, without having any particular purpose for seeking the information, may inspect and copy during regular business hours:

(1) in the limited partnership’s principal office, required information; and

(2) at a reasonable location specified by the limited partnership, any other records maintained by the limited partnership regarding the limited partnership’s activities and financial condition.

(b) Each general partner and the limited partnership shall furnish to a general partner which may be transmitted via electronic transmission:

(1) without demand, any information concerning the limited partnership’s activities and activities reasonably required for the proper exercise of the general partner’s rights and duties under the partnership agreement or this chapter; and

(2) on demand, any other information concerning the limited partnership’s activities, except to the extent the demand or the information demanded is unreasonable or otherwise improper under the circumstances.

(c) Subject to subdivision (e), on 10 days’ demand made in a record received by the limited partnership, a person dissociated as a general partner may have access to the information and records described in subdivision (a) at the location specified in subdivision (a) if:

(1) the information or record pertains to the period during which the person was a general partner;

(2) the person seeks the information or record in good faith; and

(3) the person satisfies the requirements imposed on a limited partner by subdivision (b) of Section 15903.04.

(d) The limited partnership shall respond to a demand made pursuant to subdivision (c) in the same manner as provided in subdivision (c) of Section 15903.04.

(e) If a general partner dies, Section 15907.04 applies.

(f) The limited partnership may impose reasonable restrictions on the use of information under this section. In any dispute concerning the reasonableness of a restriction under this subdivision, the limited partnership has the burden of proving reasonableness.

(g) A limited partnership may charge a person dissociated as a general partner that makes a demand under this section reasonable costs of copying, limited to the costs of labor and material.

(h) A general partner or person dissociated as a general partner may exercise the rights under this section through an attorney or other agent. Any restriction imposed under subdivision (f) or by the partnership agreement applies both to the attorney or other agent and to the general partner or person dissociated as a general partner.

(i) The rights under this section do not extend to a person as transferee, but the rights under subdivision (c) of a person dissociated as a general partner may be exercised by the legal representative of an individual who dissociated as a general partner under paragraph (2) or (3) of subdivision (g) of Section 15906.03.

history: (History: Amended by Stats. 2022, Ch. 617, Sec. 92. (SB 1202) Effective January 1, 2023.)

title: 2. PARTNERSHIPS

article: 4. General Partners


text:
(a) The fiduciary duties that a general partner owes to the limited partnership and the other partners are the duties of loyalty and care under subdivisions (b) and (c).

(b) A general partner’s duty of loyalty to the limited partnership and the other partners is limited to the following:

(1) to account to the limited partnership and hold as trustee for it any property, profit, or benefit derived by the general partner in the conduct and winding up of the limited partnership’s activities or derived from a use by the general partner of limited partnership property, including the appropriation of a limited partnership opportunity;

(2) to refrain from dealing with the limited partnership in the conduct or winding up of the limited partnership’s activities as or on behalf of a party having an interest adverse to the limited partnership; and

(3) to refrain from competing with the limited partnership in the conduct or winding up of the limited partnership’s activities.

(c) A general partner’s duty of care to the limited partnership and the other partners in the conduct and winding up of the limited partnership’s activities is limited to refraining from engaging in grossly negligent or reckless conduct, intentional misconduct, or a knowing violation of law.

(d) A general partner shall discharge the duties to the partnership and the other partners under this chapter or under the partnership agreement and exercise any rights consistently with the obligation of good faith and fair dealing.

(e) A general partner does not violate a duty or obligation under this chapter or under the partnership agreement merely because the general partner’s conduct furthers the general partner’s own interest.

title: 2. PARTNERSHIPS

article: 4. General Partners


text:
(a) A partnership agreement may provide for the creation of classes of general partners. The partnership agreement shall define the rights, powers, and duties of those classes including rights, powers, and duties senior to other classes of general partners.

(b) The partnership agreement may provide to all or certain specified classes of general partners the right to vote separately or with all or any class of the general partners on any matters.

title: 2. PARTNERSHIPS

article: 4. General Partners


text: A contribution of a partner may consist of tangible or intangible property or other benefit to the limited partnership, including money, services performed, promissory notes, other agreements to contribute cash or property, and contracts for services to be performed.

title: 2. PARTNERSHIPS

article: 5. Contributions and Distributions

path: 2. PARTNERSHIPS > 4.5. Uniform Limited Partnership Act of 2008 > 5. Contributions and Distributions


text:
(a) A partner’s obligation to contribute money or other property or other benefit to, or to perform services for, a limited partnership is not excused by the partner’s death, disability, or other inability to perform personally.

(b) If a partner does not make a promised nonmonetary contribution, the partner is obligated at the option of the limited partnership to contribute money equal to the value of that portion, as stated in the required information, of the stated contribution which has not been made.

(c) The obligation of a partner to make a contribution or return money or other property paid or distributed in violation of this chapter may be compromised only by consent of all partners. A creditor of a limited partnership which extends credit or otherwise acts in reliance on an obligation described in subdivision (a), without notice of any compromise under this subdivision, may enforce the original obligation.

(d) A partnership agreement may provide that the interest of a partner who fails to make any contribution or other payment that the partner is required to make will be subject to specific remedies for, or specific consequences of, the failure. A provision shall be enforceable in accordance with its terms unless the partner seeking to invalidate the provision establishes that the provision was unreasonable under the circumstances existing at the time the agreement was made. The specific remedies or consequences may include loss of voting, approval, or other rights, loss of the partner’s ability to actively participate in the management and operations of the partnership, liquidated damages, or a reduction of the defaulting partner’s economic rights. The reduction of the defaulting partner’s economic rights may include one or more of the following provisions:

(1) Diluting, reducing or eliminating the defaulting partner’s proportionate interest in the partnership.

(2) Subordinating the defaulting partner’s interest in the partnership to that of nondefaulting partners.

(3) Permitting a forced sale of the partnership interest.

(4) Permitting the lending or contribution by other partners of the amount necessary to meet the defaulting partner’s commitment.

(5) Adjusting the interest rates or other rates of return, preferred, priority, or otherwise, with respect to contributions by or capital accounts of the other partners.

(6) Fixing the value of the defaulting partner’s interest in the partnership by appraisal, formula and redemption, or sale of the defaulting partner’s interest in the partnership at a percentage of that value.

(7) Nothing in this section shall be construed to affect the rights of third-party creditors of the partnership to seek equitable remedies nor any rights existing under the Uniform Voidable Transactions Act (Chapter 1 (commencing with Section 3439) of Title 2 of Part 2 of Division 4 of the Civil Code).

history: (History: Amended by Stats. 2015, Ch. 44, Sec. 21. (SB 161) Effective January 1, 2016.)

title: 2. PARTNERSHIPS

article: 5. Contributions and Distributions


text: A distribution by a limited partnership must be shared among the partners on the basis of the value, as stated in the required records when the limited partnership decides to make the distribution, of the contributions the limited partnership has received from each partner.

title: 2. PARTNERSHIPS

article: 5. Contributions and Distributions


text: A partner does not have a right to any distribution before the dissolution and winding up of the limited partnership unless the limited partnership decides to make an interim distribution.

title: 2. PARTNERSHIPS

article: 5. Contributions and Distributions


text: A person does not have a right to receive a distribution on account of dissociation.

title: 2. PARTNERSHIPS

article: 5. Contributions and Distributions


text: A partner does not have a right to demand or receive any distribution from a limited partnership in any form other than cash. Subject to subdivision (b) of Section 15908.09, a limited partnership may distribute an asset in kind to the extent each partner receives a percentage of the asset equal to the partner’s share of distributions.

history: (History: Amended by Stats. 2007, Ch. 130, Sec. 44. Effective January 1, 2008.)

title: 2. PARTNERSHIPS

article: 5. Contributions and Distributions


text: When a partner or transferee becomes entitled to receive a distribution, the partner or transferee has the status of, and is entitled to all remedies available to, a creditor of the limited partnership with respect to the distribution. However, the limited partnership’s obligation to make a distribution is subject to offset for any amount owed to the limited partnership by the partner or dissociated partner on whose account the distribution is made.

title: 2. PARTNERSHIPS

article: 5. Contributions and Distributions


text:
(a) A limited partnership may not make a distribution in violation of the partnership agreement.

(b) A limited partnership may not make a distribution if after the distribution:

(1) the limited partnership would not be able to pay its debts as they become due in the ordinary course of the limited partnership’s activities; or

(2) the limited partnership’s total assets would be less than the sum of its total liabilities plus the amount that would be needed, if the limited partnership were to be dissolved, wound up, and terminated at the time of the distribution, to satisfy the preferential rights upon dissolution, winding up, and termination of partners whose preferential rights are superior to those of persons receiving the distribution.

(c) A limited partnership may base a determination that a distribution is not prohibited under subdivision (b) on financial statements prepared on the basis of accounting practices and principles that are reasonable in the circumstances or on a fair valuation or other method that is reasonable in the circumstances.

(d) Except as otherwise provided in subdivision (g), the effect of a distribution under subdivision (b) is measured:

(1) in the case of distribution by purchase, redemption, or other acquisition of a transferable interest in the limited partnership, as of the date money or other property is transferred or debt incurred by the limited partnership; and

(2) in all other cases, as of the date:

(A) the distribution is authorized, if the payment occurs within 120 days after that date; or

(B) the payment is made, if payment occurs more than l20 days after the distribution is authorized.

(e) A limited partnership’s indebtedness to a partner incurred by reason of a distribution made in accordance with this section is at parity with the limited partnership’s indebtedness to its general unsecured creditors.

(f) A limited partnership’s indebtedness, including indebtedness issued in connection with or as part of a distribution, is not considered a liability for purposes of subdivision (b) if the terms of the indebtedness provide that payment of principal and interest are made only to the extent that a distribution could then be made to partners under this section.

(g) If indebtedness is issued as a distribution, each payment of principal or interest on the indebtedness is treated as a distribution, the effect of which is measured on the date the payment is made.

title: 2. PARTNERSHIPS

article: 5. Contributions and Distributions


text:
(a) A general partner that consents to a distribution made in violation of Section 15905.08 is personally liable to the limited partnership for the amount of the distribution which exceeds the amount that could have been distributed without the violation if it is established that in consenting to the distribution the general partner failed to comply with Section 15904.08.

(b) A partner or transferee that received a distribution knowing that the distribution to that partner or transferee was made in violation of Section 15905.08 is personally liable to the limited partnership but only to the extent that the distribution received by the partner or transferee exceeded the amount that could have been properly paid under Section 15905.08.

(c) A general partner against which an action is commenced under subdivision (a) may:

(1) implead in the action any other person that is liable under subdivision (a) and compel contribution from the person; and

(2) implead in the action any person that received a distribution in violation of subdivision (b) and compel contribution from the person in the amount the person received in violation of subdivision (b).

(d) An action under this section is barred if it is not commenced within four years after the distribution.

title: 2. PARTNERSHIPS

article: 5. Contributions and Distributions


text: The profits and losses of a limited partnership shall be allocated among the partners in the manner provided in the partnership agreement. If the partnership agreement does not otherwise provide, profits and losses shall be allocated in the same manner as the partners share distributions.

title: 2. PARTNERSHIPS

article: 5. Contributions and Distributions


text:
(a) A person does not have a right to dissociate as a limited partner before the termination of the limited partnership.

(b) A person is dissociated from a limited partnership as a limited partner upon the occurrence of any of the following events:

(1) the limited partnership’s having notice of the person’s express will to withdraw as a limited partner or on a later date specified by the person;

(2) an event agreed to in the partnership agreement as causing the person’s dissociation as a limited partner;

(3) the person’s expulsion as a limited partner pursuant to the partnership agreement;

(4) the person’s expulsion as a limited partner by the unanimous consent of the other partners if:

(A) it is unlawful to carry on the limited partnership’s activities with the person as a limited partner;

(B) there has been a transfer of all of the person’s transferable interest in the limited partnership, other than a transfer for security purposes, or a court order charging the person’s interest, which has not been foreclosed;

(C) the person is a corporation and, within 90 days after the limited partnership notifies the person that it will be expelled as a limited partner because it has filed a certificate of dissolution or the equivalent, its charter has been revoked, or its right to conduct business has been suspended by the jurisdiction of its incorporation, there is no revocation of the certificate of dissolution or no reinstatement of its charter or its right to conduct business; or

(D) the person is a limited liability company or partnership that has been dissolved and whose business is being wound up;

(5) on application by the limited partnership, the person’s expulsion as a limited partner by judicial order because:

(A) the person engaged in wrongful conduct that adversely and materially affected the limited partnership’s activities;

(B) the person willfully or persistently committed a material breach of the partnership agreement or of the obligation of good faith and fair dealing under subdivision (b) of Section 15903.05; or

(C) the person engaged in conduct relating to the limited partnership’s activities which makes it not reasonably practicable to carry on the activities with the person as limited partner;

(6) in the case of a person who is an individual, the person’s death;

(7) in the case of a person that is a trust or is acting as a limited partner by virtue of being a trustee of a trust, distribution of the trust’s entire transferable interest in the limited partnership, but not merely by reason of the substitution of a successor trustee;

(8) in the case of a person that is an estate or is acting as a limited partner by virtue of being a personal representative of an estate, distribution of the estate’s entire transferable interest in the limited partnership, but not merely by reason of the substitution of a successor personal representative;

(9) termination of a limited partner that is not an individual, partnership, limited liability company, corporation, trust, or estate;

(10) the limited partnership’s participation in a conversion or merger under Article 11 (commencing with Section 15911.01), if the limited partnership:

(A) is not the converted or surviving entity; or

(B) is the converted or surviving entity but, as a result of the conversion or merger, the person ceases to be a limited partner.

title: 2. PARTNERSHIPS

article: 6. Dissociation

path: 2. PARTNERSHIPS > 4.5. Uniform Limited Partnership Act of 2008 > 6. Dissociation


text:
(a) Upon a person’s dissociation as a limited partner:

(1) subject to Section 15907.04, the person does not have further rights as a limited partner;

(2) the person’s obligation of good faith and fair dealing as a limited partner under subdivision (b) of Section 15903.05 continues only as to matters arising and events occurring before the dissociation; and

(3) subject to Section 15907.04 and Article 11 (commencing with Section 15911.01), any transferable interest owned by the person in the person’s capacity as a limited partner immediately before dissociation is owned by the person as a mere transferee.

(b) A person’s dissociation as a limited partner does not of itself discharge the person from any obligation to the limited partnership or the other partners which the person incurred while a limited partner.

title: 2. PARTNERSHIPS

article: 6. Dissociation


text:
A person is dissociated from a limited partnership as a general partner upon the occurrence of any of the following events:

(a) the limited partnership’s having notice of the person’s express will to withdraw as a general partner or on a later date specified by the person;

(b) an event agreed to in the partnership agreement as causing the persons dissociation as a general partner;

(c) the person’s expulsion as a general partner pursuant to the partnership agreement;

(d) the person’s expulsion as a general partner by the unanimous consent of the other partners if:

(1) it is unlawful to carry on the limited partnership’s activities with the person as a general partner;

(2) there has been a transfer of all or substantially all of the person’s transferable interest in the limited partnership, other than a transfer for security purposes, or a court order charging the person’s interest, which has not been foreclosed;

(3) the person is a corporation and, within 90 days after the limited partnership notifies the person that it will be expelled as a general partner because it has filed a certificate of dissolution or the equivalent, its charter has been revoked, or its right to conduct business has been suspended by the jurisdiction of its incorporation, there is no revocation of the certificate of dissolution or no reinstatement of its charter or its right to conduct business; or

(4) the person is a limited liability company or partnership that has been dissolved and whose business is being wound up;

(e) on application by the limited partnership, the person’s expulsion as a general partner by judicial order because:

(1) the person engaged in wrongful conduct that adversely and materially affected the limited partnership activities;

(2) the person willfully or persistently committed a material breach of the partnership agreement or of a duty owed to the partnership or the other partners under Section 15904.08; or

(3) the person engaged in conduct relating to the limited partnership’s activities which makes it not reasonably practicable to carry on the activities of the limited partnership with the person as a general partner;

(f) the person’s:

(1) becoming a debtor in bankruptcy;

(2) execution of an assignment for the benefit of creditors;

(3) seeking, consenting to, or acquiescing in the appointment of a trustee, receiver, or liquidator of the person or of all or substantially all of the person’s property; or

(4) failure, within 90 days after the appointment, to have vacated or stayed the appointment of a trustee, receiver, or liquidator of the general partner or of all or substantially all of the person’s property obtained without the person’s consent or acquiescence, or failing within 90 days after the expiration of a stay to have the appointment vacated;

(g) in the case of a person who is an individual:

(1) the person’s death;

(2) the appointment of a guardian or general conservator for the person; or

(3) a judicial determination that the person has otherwise become incapable of performing the person’s duties as a general partner under the partnership agreement;

(h) in the case of a person that is a trust or is acting as a general partner by virtue of being a trustee of a trust, distribution of the trust’s entire transferable interest in the limited partnership, but not merely by reason of the substitution of a successor trustee;

(i) in the case of a person that is an estate or is acting as a general partner by virtue of being a personal representative of an estate, distribution of the estate’s entire transferable interest in the limited partnership, but not merely by reason of the substitution of a successor personal representative;

(j) termination of a general partner that is not an individual, partnership, limited liability company, corporation, trust, or estate; or

(k) the limited partnership’s participation in a conversion or merger under Article 11 (commencing with Section 15911.01), if the limited partnership:

(1) is not the converted or surviving entity; or

(2) is the converted or surviving entity but, as a result of the conversion or merger, the person ceases to be a general partner.

title: 2. PARTNERSHIPS

article: 6. Dissociation


text:
(a) A person has the power to dissociate as a general partner at any time, rightfully or wrongfully, by express will pursuant to subdivision (a) of Section 15906.03.

(b) A person’s dissociation as a general partner is wrongful only if:

(1) it is in breach of an express provision of the partnership agreement; or

(2) it occurs before the termination of the limited partnership, and:

(A) the person withdraws as a general partner by express will;

(B) the person is expelled as a general partner by judicial determination under subdivision (e) of Section 15906.03;

(C) the person is dissociated as a general partner by becoming a debtor in bankruptcy; or

(D) in the case of a person that is not an individual, trust other than a business trust, or estate, the person is expelled or otherwise dissociated as a general partner because it willfully dissolved or terminated.

(c) A person that wrongfully dissociates as a general partner is liable to the limited partnership and, subject to Section 15910.01, to the other partners for damages caused by the dissociation. The liability is in addition to any other obligation of the general partner to the limited partnership or to the other partners.

title: 2. PARTNERSHIPS

article: 6. Dissociation


text:
(a) Upon a person’s dissociation as a general partner all of the following apply:

(1) The person’s right to participate as a general partner in the management and conduct of the partnership’s activities terminates.

(2) The person’s duty of loyalty as a general partner under paragraph (3) of subdivision (b) of Section 15904.08 terminates.

(3) The person’s duty of loyalty as a general partner under paragraphs (1) and (2) of subdivision (b) of Section 15904.08 and duty of care under subdivision (c) of Section 15904.08 continue only with regard to matters arising and events occurring before the person’s dissociation as a general partner.

(4) The person may sign and deliver to the Secretary of State on a form prescribed by the Secretary of State for filing, containing the name of the limited partnership and the Secretary of State’s file number of the limited partnership, a certificate of dissociation pertaining to the person and, at the request of the limited partnership, shall sign an amendment to the certificate of limited partnership which states that the person has dissociated.

(5) Subject to Section 15907.04 and Article 11 (commencing with Section 15911.01), any transferable interest owned by the person immediately before dissociation in the person’s capacity as a general partner is owned by the person as a mere transferee.

(b) A person’s dissociation as a general partner does not of itself discharge the person from any obligation to the limited partnership or the other partners which the person incurred while a general partner.

history: (History: Amended by Stats. 2014, Ch. 834, Sec. 27. (SB 1041) Effective January 1, 2015.)

title: 2. PARTNERSHIPS

article: 6. Dissociation


text:
(a) After a person is dissociated as a general partner and before the limited partnership is dissolved, converted under Article 11 (commencing with Section 15911.01), or merged out of existence under that article, the limited partnership is bound by an act of the person only if:

(1) the act would have bound the limited partnership under Section 15904.02 before the dissociation; and

(2) at the time the other party enters into the transaction:

(A) less than two years have passed since the dissociation; and

(B) the other party does not have notice of the dissociation and reasonably believes that the person is a general partner.

(b) If a limited partnership is bound under subdivision (a), the person dissociated as a general partner which caused the limited partnership to be bound is liable:

(1) to the limited partnership for any damage caused to the limited partnership arising from the obligation incurred under subdivision (a); and

(2) if a general partner or another person dissociated as a general partner is liable for the obligation, to the general partner or other person for any damage caused to the general partner or other person arising from the liability.

title: 2. PARTNERSHIPS

article: 6. Dissociation


text:
(a) A person’s dissociation as a general partner does not of itself discharge the person’s liability as a general partner for an obligation of the limited partnership incurred before dissociation. Except as otherwise provided in subdivisions (b) and (c), the person is not liable for a limited partnership’s obligation incurred after dissociation.

(b) A person whose dissociation as a general partner resulted in a dissolution and winding up of the limited partnership’s activities is liable to the same extent as a general partner under Section 15904.04 on an obligation incurred by the limited partnership under Section 15908.04.

(c) A person that has dissociated as a general partner but whose dissociation did not result in a dissolution and winding up of the limited partnership’s activities is liable on a transaction entered into by the limited partnership after the dissociation only if:

(1) a general partner would be liable on the transaction; and

(2) at the time the other party enters into the transaction:

(A) less than two years have passed since the dissociation; and

(B) the other party does not have notice of the dissociation and reasonably believes that the person is a general partner.

(d) By agreement with a creditor of a limited partnership and the limited partnership, a person dissociated as a general partner may be released from liability to the creditor for an obligation of the limited partnership.

(e) A person dissociated as a general partner is released from liability for an obligation of the limited partnership if the limited partnership’s creditor, with notice of the person’s dissociation as a general partner but without the person’s consent, agrees to a material alteration in the nature or time of payment of the obligation.

title: 2. PARTNERSHIPS

article: 6. Dissociation


text: The only interest of a partner which is transferable is the partner’s transferable interest. A transferable interest is personal property.

title: 2. PARTNERSHIPS

path: 2. PARTNERSHIPS > 4.5. Uniform Limited Partnership Act of 2008 > 7. Transferable Interests and Rights of Transferees and Creditors


text:
(a) A transfer, in whole or in part, of a partner’s transferable interest:

(1) is permissible;

(2) does not by itself cause the partner’s dissociation or a dissolution and winding up of the limited partnership’s activities; and

(3) does not, as against the other partners or the limited partnership, entitle the transferee to participate in the management or conduct of the limited partnership’s activities, to require access to information concerning the limited partnership’s transactions except as otherwise provided in subdivision (c), or to inspect or copy the required information or the limited partnership’s other records or to exercise any other rights or powers of a partner.

(b) A transferee has a right to receive, in accordance with the transfer, distributions to which the transferor would otherwise be entitled.

(c) A transferee is entitled to an account of the limited partnership’s transactions only upon the dissolution and winding up of the limited partnership.

(d) Upon transfer, the transferor retains the rights of a partner other than the interest in distributions transferred and retains all duties and obligations of a partner.

(e) A limited partnership need not give effect to a transferee’s rights under this section until the limited partnership has notice of the transfer.

(f) A transfer of a partner’s transferable interest in the limited partnership in violation of a restriction on transfer contained in the partnership agreement is ineffective as to a person having notice of the restriction at the time of transfer.

(g) A transferee that becomes a partner with respect to a transferable interest is liable for the transferor’s obligations under Sections 15905.02 and 15905.09. However, the transferee is not obligated for liabilities unknown to the transferee at the time the transferee became a partner.

(h) A transferee of a partnership interest, including a transferee of a general partner, may become a limited partner if and to the extent that (1) the partnership agreement provides or (2) all general partners and a majority in interest of the limited partners consent.

title: 2. PARTNERSHIPS

article: 7. Transferable Interests and Rights of Transferees and Creditors


text:
(a) On application to a court of competent jurisdiction by any judgment creditor of a partner or transferee, the court may charge the transferable interest of the judgment debtor with payment of the unsatisfied amount of the judgment with interest. To the extent so charged, the judgment creditor has only the rights of a transferee. The court may appoint a receiver of the share of the distributions due or to become due to the judgment debtor in respect of the limited partnership and make all other orders, directions, accounts, and inquiries the judgment debtor might have made or which the circumstances of the case may require to give effect to the charging order.

(b) A charging order constitutes a lien on the judgment debtor’s transferable interest. The court may order a foreclosure upon the interest subject to the charging order at any time. The purchaser at the foreclosure sale has the rights of a transferee.

(c) At any time before foreclosure, an interest charged may be redeemed:

(1) by the judgment debtor;

(2) with property other than limited partnership property, by one or more of the other partners; or

(3) with limited partnership property, by the limited partnership with the consent of all partners whose interests are not so charged.

(d) This chapter does not deprive any partner or transferee of the benefit of any exemption laws applicable to the partner’s or transferee’s transferable interest.

(e) This section provides the exclusive remedy by which a judgment creditor of a partner or transferee may satisfy a judgment out of the judgment debtor’s transferable interest.

(f) No creditor of a partner shall have any right to obtain possession or otherwise exercise legal or equitable remedies with respect to the property of the limited partnership.

title: 2. PARTNERSHIPS


text: If a partner dies, the deceased partner’s personal representative or other legal representative may exercise the rights of a transferee as provided in Section 15907.02 and, for the purposes of settling the estate, may exercise the rights of a current limited partner under Section 15903.04.

title: 2. PARTNERSHIPS


text:
Except as otherwise provided in Section 15908.02, a limited partnership is dissolved, and its activities must be wound up, only upon the occurrence of any of the following:

(a) the happening of an event specified in the partnership agreement;

(b) the consent of all general partners and of limited partners owning a majority of the rights to receive distributions as limited partners at the time the consent is to be effective;

(c) after the dissociation of a person as a general partner:

(1) if the limited partnership has at least one remaining general partner, and a consent to dissolve the limited partnership is given within 90 days after the dissociation by partners owning a majority of the rights to receive distributions as partners at the time the consent is to be effective; or

(2) if the limited partnership does not have a remaining general partner, the passage of 90 days after the dissociation, unless before the end of the period:

(A) consent to continue the activities of the limited partnership and admit at least one general partner is given by limited partners owning a majority of the rights to receive distributions as limited partners at the time the consent is to be effective; and

(B) at least one person is admitted as a general partner in accordance with the consent; or

(d) the passage of 90 days after the dissociation of the limited partnership’s last limited partner, unless before the end of the period the limited partnership admits at least one limited partner.

title: 2. PARTNERSHIPS

article: 8. Dissolution

path: 2. PARTNERSHIPS > 4.5. Uniform Limited Partnership Act of 2008 > 8. Dissolution


text:
(a) On application by a partner, a court of competent jurisdiction may order dissolution of a limited partnership if it is not reasonably practicable to carry on the activities of the limited partnership in conformity with the partnership agreement.

(b) In any suit for judicial dissolution, the other partners may avoid the dissolution of the limited partnership by purchasing for cash the partnership interests owned by the partners so initiating the proceeding (the “moving parties”) at their fair market value. In fixing the value, the amount of any damages resulting if the initiation of the dissolution is a breach by any moving party or parties of an agreement with the purchasing party or parties, including, without limitation, the partnership agreement, may be deducted from the amount payable to the moving party or parties.

(c) If the purchasing parties (1) elect to purchase the partnership interests owned by the moving parties, (2) are unable to agree with the moving parties upon the fair market value of the partnership interests, and (3) give bond with sufficient security to pay the estimated reasonable expenses, including attorneys’ fees, of the moving parties if the expenses are recoverable under subdivision (d), the court, upon application of the purchasing parties, either in the pending action or in a proceeding initiated in the superior court of the proper county by the purchasing parties, shall stay the winding up and dissolution proceeding and shall proceed to ascertain and fix the fair market value of the partnership interests owned by the moving parties.

(d) The court shall appoint three disinterested appraisers to appraise the fair market value of the partnership interests owned by the moving parties, and shall make an order referring the matter to the appraisers so appointed for the purpose of ascertaining that value. The order shall prescribe the time and manner of producing evidence, if evidence is required. The award of the appraisers or a majority of them, when confirmed by the court, shall be final and conclusive upon all parties. The court shall enter a decree that shall provide in the alternative for winding up and dissolution of the limited partnership unless payment is made for the partnership interests within the time specified by the decree. If the purchasing parties do not make payment for the partnership interests within the time specified, judgment shall be entered against them and the surety or sureties on the bond for the amount of the expenses, including attorneys’ fees, of the moving parties. Any member aggrieved by the action of the court may appeal therefrom.

(e) If the purchasing parties desire to prevent the winding up and dissolution of the limited partnership, they shall pay to the moving parties the value of their partnership interests ascertained and decreed within the time specified pursuant to this section, or, in the case of an appeal, as fixed on appeal. On receiving that payment or the tender thereof, the moving parties shall transfer their partnership interests to the purchasing parties.

(f) For the purposes of this section, the valuation date shall be the date upon which the action for judicial dissolution was commenced. However, the court may, upon the hearing of a motion by any party, and for good cause shown, designate some other date as the valuation date.

history: (History: Amended by Stats. 2022, Ch. 617, Sec. 93. (SB 1202) Effective January 1, 2023.)

title: 2. PARTNERSHIPS

article: 8. Dissolution


text:
(a) A limited partnership continues after dissolution only for the purpose of winding up its activities.

(b) In winding up its activities, the limited partnership:

(1) may amend its certificate of limited partnership to state that the limited partnership is dissolved, preserve the limited partnership business or property as a going concern for a reasonable time, prosecute and defend actions and proceedings, whether civil, criminal, or administrative, transfer the limited partnership’s property, settle disputes by mediation or arbitration, file a certificate of cancellation as provided in Section 15902.03, and perform other necessary acts; and

(2) shall discharge the limited partnership’s liabilities, settle and close the limited partnership’s activities, and marshal and distribute the assets of the partnership.

(c) If a dissolved limited partnership does not have a general partner, a person to wind up the dissolved limited partnership’s activities may be appointed by the consent of limited partners owning a majority of the rights to receive distributions as limited partners at the time the consent is to be effective. A person appointed under this subdivision:

(1) has the powers of a general partner under Section 15908.04; and

(2) shall promptly amend the certificate of limited partnership to state:

(A) that the limited partnership does not have a general partner;

(B) the name of the person that has been appointed to wind up the limited partnership; and

(C) the address of the person.

(d) On the application of any partner, the appropriate court may order judicial supervision of the winding up, including the appointment of a person to wind up the dissolved limited partnership’s activities, if:

(1) a limited partnership does not have a general partner and within a reasonable time following the dissolution no person has been appointed pursuant to subdivision (c); or

(2) the applicant establishes other good cause.

(e) Unless otherwise provided in the partnership agreement, the limited partners winding up the affairs of the partnership pursuant to this section shall be entitled to reasonable compensation.

title: 2. PARTNERSHIPS

article: 8. Dissolution


text:
(a) A limited partnership is bound by a general partner’s act after dissolution which:

(1) is appropriate for winding up the limited partnership’s activities; or

(2) would have bound the limited partnership under Section 15904.02 before dissolution, if, at the time the other party enters into the transaction, the other party does not have notice of the dissolution.

(b) A person dissociated as a general partner binds a limited partnership through an act occurring after dissolution if:

(1) at the time the other party enters into the transaction:

(A) less than two years have passed since the dissociation; and

(B) the other party does not have notice of the dissociation and reasonably believes that the person is a general partner; and

(2) the act:

(A) is appropriate for winding up the limited partnership’s activities; or

(B) would have bound the limited partnership under Section 15904.02 before dissolution and at the time the other party enters into the transaction the other party does not have notice of the dissolution.

title: 2. PARTNERSHIPS

article: 8. Dissolution


text:
(a) If a general partner having knowledge of the dissolution causes a limited partnership to incur an obligation under subdivision (a) of Section 15908.04 by an act that is not appropriate for winding up the partnership’s activities, the general partner is liable:

(1) to the limited partnership for any damage caused to the limited partnership arising from the obligation; and

(2) if another general partner or a person dissociated as a general partner is liable for the obligation, to that other general partner or person for any damage caused to that other general partner or person arising from the liability.

(b) If a person dissociated as a general partner causes a limited partnership to incur an obligation under subdivision (b) of Section 15908.04, the person is liable:

(1) to the limited partnership for any damage caused to the limited partnership arising from the obligation; and

(2) if a general partner or another person dissociated as a general partner is liable for the obligation, to the general partner or other person for any damage caused to the general partner or other person arising from the liability.

title: 2. PARTNERSHIPS

article: 8. Dissolution


text:
(a) A dissolved limited partnership may dispose of the known claims against it by following the procedure described in subdivision (b).

(b) A dissolved limited partnership may notify its known claimants of the dissolution in a record. The notice must:

(1) specify the information required to be included in a claim;

(2) provide a mailing address to which the claim is to be sent;

(3) state the deadline for receipt of the claim, which may not be less than 120 days after the date the notice is received by the claimant; and

(4) state that the claim will be barred if not received by the deadline.

(c) A claim against a dissolved limited partnership is barred if the requirements of subdivision (b) are met and:

(1) the claim is not received by the specified deadline; or

(2) in the case of a claim that is timely received but rejected in writing by the dissolved limited partnership, the claimant does not commence an action to enforce the claim against the limited partnership within 90 days after the receipt of a written notice of the rejection.

(d) This section does not apply to a claim based on an event occurring after the effective date of dissolution or a liability that is contingent on that date.

title: 2. PARTNERSHIPS

article: 8. Dissolution