New Jersey Statutes 42:2A-28. Person erroneously believing himself a limited partner
Terms Used In New Jersey Statutes 42:2A-28
- Amendment: A proposal to alter the text of a pending bill or other measure by striking out some of it, by inserting new language, or both. Before an amendment becomes part of the measure, thelegislature must agree to it.
- Contribution: means any cash, property, services rendered, or a promissory note or other binding obligation to contribute cash or property or to perform services, which a partner contributes to a limited partnership in his capacity as a partner. See New Jersey Statutes 42:2A-5
- General partner: means a person who has been admitted to a limited partnership as a general partner in accordance with the partnership agreement and named in the certificate of limited partnership as a general partner. See New Jersey Statutes 42:2A-5
- Limited partner: means a person who has been admitted to a limited partnership as a limited partner in accordance with the partnership agreement. See New Jersey Statutes 42:2A-5
- Partner: means a limited or general partner. See New Jersey Statutes 42:2A-5
- 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.
- Person: means a natural person, partnership, limited partnership (domestic or foreign), limited liability company or other limited liability entity, trust, estate, association, or corporation. See New Jersey Statutes 42:2A-5
- Secretary of State: refers to the State Treasurer, based upon the transfer of the functions, powers and duties of the Division of Commercial Recording, established pursuant to section 1 of P. See New Jersey Statutes 42:2A-5
- State: means a state, territory, or possession of the United States, the District of Columbia, or the Commonwealth of Puerto Rico. See New Jersey Statutes 42:2A-5
a. Except as provided in subsection b., a person who makes a contribution to a business enterprise and erroneously but in good faith believes that he has become a limited partner in the enterprise is not a general partner in the enterprise and is not bound by its obligations by reason of making the contribution, receiving distributions from the enterprise, or exercising any rights of a limited partner, if, on ascertaining that no certificate of limited partnership was ever filed with the Secretary of State or a certificate of limited partnership has been filed which names the person as a general partner in the enterprise he promptly:
(1) Causes an appropriate certificate of limited partnership, certificate of correction or a certificate of amendment to be executed and filed; or
(2) Withdraws from future equity participation in the enterprise by executing and filing in the office of the Secretary of State a certificate declaring withdrawal under this section.
b. A person who makes a contribution of the kind described in subsection a. is liable as a general partner to any third party who transacted business with the enterprise if the third party actually believed in good faith that the person was a general partner at the time of the transaction and no certificate of limited partnership was ever filed or a certificate of limited partnership was filed which names the person as a general partner, and:
(1) The business is transacted before an appropriate certificate of limited partnership is filed stating that the enterprise is a limited partnership and indicating in effect that the person is not a general partner;
(2) In the case of an amendment, it is after expiration of the 30-day period for filing an amendment indicating in effect that the person is not a general partner under section 16 of P.L. 1983, c. 489 (C. 42:2A-17) and the amendment has not been filed;
(3) Before the person withdraws, and an appropriate certificate, as provided in section 27 of P.L. 1983, c. 489 (C. 42:2A-28), is filed to show the withdrawal; or
(4) The business is transacted before an appropriate certificate of correction is filed indicating in effect that the person is not a general partner and the third party actually relied in good faith upon the foregoing inaccuracy and is adversely affected by the correction.
L. 1983, c. 489, s. 27; amended 1988,c.130,s.15.