Section 20Part 1 — Exempted Limited Partnership Act
Liability of limited partner
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If a limited partner takes part in the conduct of the business of an exempted limited partnership in its dealings with persons who are not partners, that limited partner shall be liable, in the event of the insolvency of the exempted limited partnership, for all debts and obligations of that exempted limited partnership in curred during the period that that limited partner participates in the conduct of the business as though that limited partner were, for that period, a general partner, but that limited partner shall be liable only to a person who transacts business with the exempted limited partnership during the period with actual knowledge of that limited partner’s participation and who then reasonably believed the limited partner to be a general partner.
A limited partner does not take part in the conduct of the business of an exempted limited pa rtnership within the meaning of this section by —
holding an office or interest in, or having a contractual relationship with, a general partner or being a contractor for or an agent or employee of the exempted limited partnership or of a general partn er or acting as a director, officer or shareholder of a corporate general partner;
consulting with and advising a general partner or consenting or withholding consent to any action proposed, in the manner contemplated by the partnership agreement, with respect to the business of the exempted limited partnership;
investigating, reviewing, approving or being advised as to the accounts or business affairs of the exempted limited partnership or exercising any right conferred by this Act ;
acting as s urety or guarantor for the exempted limited partnership either generally or in respect of specific obligations;
approving or disapproving an amendment to the partnership agreement;
calling, requesting, attending or participating in any meeting of t he partners;
taking any action that results in the winding up or the dissolution of the exempted limited partnership;
taking any action required or permitted by the partnership agreement or by law to bring, pursue, settle or terminate any action or proceedings brought pursuant to section 33(2);
appointing a person to serve on any board or committee of the exempted limited partnership, a general partner or a limited partner or removing a person therefrom;
serving on any board or committee of the exempted limited partnership, a general partner, the limited partners or the partners, or by appointing, electing or otherwise participating in the choice of a representative or any other person to serve on any boar d or committee, or by acting as a member of any board or committee either directly or by or through any representative or other person, including giving advice or consenting, or refusing to consent, to any action proposed by the general partner on behalf o f the exempted limited partnership and exercising any powers or authorities or performing any obligations as a member of that board or committee in the manner contemplated by the partnership agreement;
serving on the board of directors or a committee o f, consulting with or advising or being an officer, director, shareholder, partner, member, manager, trustee, agent or employee of, or by being a fiduciary or contractor for, any person in which the exempted limited partnership has an interest or any perso n providing management, consultation, custody or other services or other products for, to or on behalf of, or otherwise having a business or other relationship with, the exempted limited partnership or a general partner of the exempted limited partnership; or
voting as a limited partner on —
the winding up and dissolution of the exempted limited partnership;
the purchase, sale, exchange, lease, mortgage, pledge or other acquisition or transfer of any asset by or of the exempted limited partners hip;
the incurrence or renewal of indebtedness by the exempted limited partnership;
a change in the nature of the business of the exempted limited partnership;
the admission, removal or withdrawal of a general or limited partner and the continuation of business of the exempted limited partnership thereafter; or
transactions in which one or more of the general partners have an actual or potential conflict of interest with one or more of the limited partners.
Subsection (2) shall n ot import any implication that the possession or exercise of any other power by a limited partner will necessarily constitute the taking part by that limited partner in the business of the exempted limited partnership.