Question

Name and discuss the fiduciary duties owed by general partners to the partnership as set out in the Revised Uniform Partnership Act.

Answer 1

Solution:

Following are the duties owed by the general partner to the partnership under the Revised Uniform Partnership Act (RUPA)

1. Duty to Serve:

This is the duty partner is expected to devote him/herself to the work of the partnership. Partner must work with co-partner when demanded in the interest of the partnership.

2.The Duty of Loyalty:

Partner is expected to act in the best interest of the partnership. The partner should avoid doing an activity that leads to loss to a partnership like competing with the partnership in business. The partner should focus on collective good over individual good.

3. Duty of care:

The partner must take decisions keeping in mind the benefit of the whole partnership. In real business work, there may be cases of negligence and unintentional mistakes happen but that must be bonified. Duty of care cover gross negligence and intentional misconduct.

4. The duty of Obedience

The partner should not breach the terms of the partnership agreement and must work within the defined authorities and do not undertake any ultra virus action.

5. Duty to inform co-partner

Partner is expected to inform the co-partners about the matter which is in the interest of the partnership.

6. Duty of Account

Partners must allow the co-partners and their agent access to the partnership book of account and provide any other information related to the partnership business

Note:

A. Like the partner under partnership have duty they also enjoy rights like

1. To distribution of money including profit (and loss)

2. To Management

3. To choose co-partner

4. To the property of the partnership

5. To assign the partnership interest

6. To enforce partnership right