N.Y. Partnership Law 121-304 – Person erroneously believing himself a limited partner
§ 121-304. Person erroneously believing himself a limited partner. (a) Except as provided in subdivision (b) of this section, a person who makes a contribution to a limited partnership and erroneously but in good faith believes that he has become a limited partner in the limited partnership is not a general partner in the limited partnership and is not bound by its obligations by reason of making the contribution, receiving distributions from the limited partnership or exercising any rights of a limited partner, if, on ascertaining the mistake, he:
Terms Used In N.Y. Partnership Law 121-304
- 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.
- Certificate of limited partnership: means the certificate referred to in section 121-201 of this article, and the certificate as amended. See N.Y. Partnership Law 121-101
- Contribution: means any cash, property, services rendered, or a promissory note or other binding obligation to contribute cash or property or to render services, which a partner contributes to a limited partnership in his capacity as a partner. See N.Y. Partnership Law 121-101
- General partner: means a person who has been admitted to a limited partnership as a general partner in accordance with the partnership agreement and, if required by the law of the jurisdiction under which the limited partnership or foreign limited partnership, as the case may be, is organized, is so named in the certificate of limited partnership or similar instrument. See N.Y. Partnership Law 121-101
- Limited partner: means a person who has been admitted to a limited partnership as a limited partner in accordance with the partnership agreement or as otherwise provided by the law of the jurisdiction under which the limited partnership or foreign limited partnership, as the case may be, is organized. See N.Y. Partnership Law 121-101
- Partner: means a limited or general partner. See N.Y. Partnership Law 121-101
- 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 (domestic or foreign), trust, estate, custodian, nominee, association, corporation or any other individual or entity in its own or any representative capacity. See N.Y. Partnership Law 121-101
(1) causes an accurate certificate of limited partnership or a certificate of amendment to be executed and filed; or
(2) withdraws from the partnership by executing and delivering to the limited partnership a written notice declaring withdrawal under this section.
(b) A person who makes a contribution of the kind described in subdivision (a) of this section is liable as a general partner to any third party who transacts business with the limited partnership (i) before the person withdraws and an appropriate certificate is filed to show withdrawal, or (ii) before an appropriate certificate is filed to show that he is not a general partner, but in either case only if the third party reasonably believed, based upon the limited partner's conduct, that the limited partner was a general partner and extended credit to the partnership in reasonable reliance on the credit of such person.