Texas Business Organizations Code 153.109 – Liability of Erroneous Contributor
Current as of: 2024 | Check for updates
|
Other versions
Terms Used In Texas Business Organizations Code 153.109
- Business: means a trade, occupation, profession, or other commercial activity. See Texas Business Organizations Code 1.002
- Contribution: means a tangible or intangible benefit that a person transfers to an entity in consideration for an ownership interest in the entity or otherwise in the person's capacity as an owner or a member. See Texas Business Organizations Code 1.002
- General partner: means :
(A) each partner in a general partnership; or
(B) a person who has become, and has not ceased to be, a general partner in a limited partnership in accordance with the governing documents of the limited partnership or this code. See Texas Business Organizations Code 1.002 - Partner: means a limited partner or general partner. See Texas Business Organizations Code 1.002
- 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: means an entity governed as a partnership under Title 4. See Texas Business Organizations Code 1.002
- Person: means an individual or a corporation, partnership, limited liability company, business trust, trust, association, or other organization, estate, government or governmental subdivision or agency, or other legal entity, or a protected series or registered series of a domestic limited liability company or foreign entity. See Texas Business Organizations Code 1.002
Regardless of whether Sections 153.106, 153.107, and 153.108 apply, a person who makes a contribution in the circumstances described by § 153.106 is liable as a general partner to a third party who transacts business with the partnership before an action taken under § 153.106 if:
(1) the contributor has knowledge or notice that no certificate has been filed or that the certificate inaccurately referred to the contributor as a general partner; and
(2) the third party reasonably believed, based on the contributor’s conduct, that the contributor was a general partner at the time of the transaction and extended credit to the partnership in reasonable reliance on the credit of the contributor.