Summary of Partnership Rights and Relationships

Introduction

• Today's focus: Relationship of partnership to its partners and partners' rights.
• Reminder: For educational purposes only, not legal advice.

Relationship Created by Contract of Partnership

• Creates relations among partners and between partnership and its partners.
• Partnership has responsibilities to partners:
  • Refund amounts disbursed by partners on behalf of partnership (includes interest).
  • Answer for obligations contracted by partners in good faith for partnership.
  • Risk management: Partnership answers for risks as long as partner acts within authority and is not at fault.

Rights of Partners

1. Property Rights of Partners (Article 1810)

   • Rights in specific partnership property.
   • Interest in the partnership (equity rights).
   • Right to participate in management.

2. Reimbursement Rights

   • Right to reimbursement for amounts advanced to partnership.
   • Right to indemnification for risks in consequence of management.

3. Sub-Partnership Rights (Article 1804)

   • Right to associate with another person in his share (contract of sub-partnership).
   • Sub-partner does not acquire rights of a partner or liability for partnership debts unless all partners agree to modify the partnership.

4. Access to Partnership Books

   • Right to access and inspect partnership books within reasonable hours.
   • Right is not absolute; cannot use information for purposes outside of partnership.

5. Right to Full Information (Article 1806)

   • Right to demand and receive true and full information affecting the partnership.
   • Right does not apply to matters already present in books.

6. Formal Accounting Rights (Article 1809)

   • Generally, a partner is not entitled to a formal account unless certain conditions are met (e.g., wrongful exclusion, agreement terms).

7. Dissolution Rights

   • Right to have the partnership dissolved under certain conditions (to be discussed in future episodes).

8. Use of Firm Name

   • Partnership operates under a firm name, which may include partner names.
   • Non-partners using partnership name do not acquire partner rights but may incur liability to third parties (partners by estoppel).
   • Partners can choose any firm name but must avoid misleading or identical names to existing partnerships.
   • If a partner dies, the partnership may continue using their name if indicated that they are deceased.

Conclusion

• Recap of partner rights: Property rights, reimbursement rights, sub-partnership rights, access to books, right to information, formal accounting rights, dissolution rights, and use of firm name.
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