This post is based on a question about general partners that I answered on Quora a couple of weeks ago.
Q.: Why do general partnerships and limited partnerships both have a “general partner” position?
A.: General partners – in each type of partnership – have control over and manage the business. They are jointly and severally liable for the partnership’s obligations. (more…)
A short while ago, I answered a Quora question about whether and why a startup might want to form a general partnership. The question and my answer are paraphrased, with emphasis added, below.
Q. What are some of the reasons a business might organize itself as a general partnership? Considering all the liability risk that general partners might potentially face, why not organize as a limited liability company? Was there an era when the general partnership was an attractive form and, if so, why?
Earlier this year, I wrote about how business founders who agree to split earnings from their venture can find that they have unintentionally created a general partnership (Beware the Unintended Partnership). The problem: Any partner can subject all of the partners to unlimited personal liability for partnership obligations!
This post provides an overview of how an unintended, or otherwise undesirable, California general partnership can be terminated.
Half or more of the partners can decide to wind up the business of the partnership and dissolve it (California Corporations Code Section 16801(1)).