Corporations, Associations, and Partnerships


SECTION 7-12-29

§ 7-12-29. Rules determining rights and duties of partners.

The rights and duties of the partners in relation to the partnership are determined, subject to any agreement between them, by the following rules:

(1) Each partner is repaid his or her contributions, whether by way of capital or advances to the partnership property and shares equally in the profits and surplus remaining after all liabilities, including those to partners, are satisfied; and except as provided in § 7-12-26(b), each partner must contribute toward the losses, whether of capital or otherwise, sustained by the partnership according to his or her share in the profits.

(2) The partnership must indemnify every partner in respect of payments made and personal liabilities reasonably incurred by him or her in the ordinary and proper conduct of its business, or for the preservation of its business or property.

(3) A partner, who in aid of the partnership makes any payment or advance beyond the amount of capital which he or she agreed to contribute, is paid interest from the date of the payment or advance.

(4) A partner receives interest on the capital contributed by him or her only from the date when repayment should be made.

(5) All partners have equal rights in the management and conduct of the partnership business.

(6) No partner is entitled to remuneration for acting in the partnership business, except that a surviving partner is entitled to reasonable compensation for his or her services in winding up the partnership affairs.

(7) No person can become a member of a partnership without the consent of all the partners.

(8) Any difference arising as to ordinary matters connected with the partnership business may be decided by a majority of the partners; but no act in contravention of any agreement between the partners may be done rightfully without the consent of all the partners.

History of Section.
(R.P.L. 1957, ch. 74, § 18; P.L. 1996, ch. 270, § 1.)