48-7-304 Person erroneously believing himself limited partner.
Person erroneously believing himself limited partner.
(a) Except as provided in this
section, 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 the
Causes an appropriate certificate of limited partnership or certificate of amendment to be
executed and filed; or
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 subdivision (a) is liable as a
general partner to any third party who transacts business with the enterprise:
Before the person withdraws and an appropriate certificate is filed to show withdrawal;
Before an appropriate certificate is filed to show that he is not a general partner, but in
either case only if the third party actually believed in good faith that the person was a
general partner at the time of the transaction.
SL 1986, ch 391, §§ 304(a), 304(b).