(a) The duties that a general partner has to the limited partnership and to the other partners include the duty of loyalty and the duty of care as described in subsections (b) and (c).

Attorney's Note

Under the Alabama Code, punishments for crimes depend on the classification. In the case of this section:
ClassPrisonFine
Violationup to 30 daysup to $200
For details, see Ala. Code § 13A-5-7

Terms Used In Alabama Code 10A-9A-4.08

  • Appropriation: The provision of funds, through an annual appropriations act or a permanent law, for federal agencies to make payments out of the Treasury for specified purposes. The formal federal spending process consists of two sequential steps: authorization
  • following: means next after. See Alabama Code 1-1-1
  • GENERAL PARTNER: means :
    (A) with respect to a limited partnership, a person that:
    (i) is admitted as a general partner under Section 10A-9A-4. See Alabama Code 10A-9A-1.02
  • Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
  • partner: means a limited partner or general partner. See Alabama Code 10A-9A-1.02
  • Partnership: A voluntary contract between two or more persons to pool some or all of their assets into a business, with the agreement that there will be a proportional sharing of profits and losses.
  • PARTNERSHIP AGREEMENT: means any agreement (whether referred to as a partnership agreement or otherwise), written, oral or implied, of the partners as to the activities and affairs of a limited partnership. See Alabama Code 10A-9A-1.02
  • property: includes both real and personal property. See Alabama Code 1-1-1
  • Trustee: A person or institution holding and administering property in trust.
(b) A general partner‘s duty of loyalty to the limited partnership and to the other partners includes each of the following:

(1) to account to the limited partnership and to hold as trustee for it any property, profit, or benefit derived by the general partner in the conduct or winding up of the limited partnership’s activities and affairs or derived from a use by the general partner of limited partnership property, including the appropriation of a limited partnership opportunity;
(2) to refrain from dealing with the limited partnership in the conduct or winding up of the limited partnership’s activities and affairs as or on behalf of a party having an interest adverse to the limited partnership; and
(3) to refrain from competing with the limited partnership in the conduct or winding up of the limited partnership’s activities and affairs.
(c) A general partner’s duty of care to the limited partnership and to the other partners in the conduct or winding up of the limited partnership’s activities and affairs includes refraining from engaging in grossly negligent or reckless conduct, intentional misconduct, or a knowing violation of law.
(d) A general partner shall discharge the duties to the limited partnership and to the other partners under this chapter and under the partnership agreement and exercise any rights consistently with the implied contractual covenant of good faith and fair dealing.
(e) A general partner does not violate a duty or obligation under this chapter or under the partnership agreement merely because the general partner’s conduct furthers the general partner’s own interest.
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