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Partnership in Commendam Analysis
Partnership in Commendam Analysis
Rules:
Under Louisiana Law, a partnership in commendam consists of one or more general
partners who have the
1. powers,
2. rights, and
3. obligations of partners;
And one or more partners in commendam, or limited partners, whose
1. powers,
2. rights, and
3. obligation of a limited partnership.
Under Louisiana Law, a contract of partnership in commendam must be in writing and
filed for registry with the secretary of state as provided by law.
Until the contract is filed for registry, partners in commendam are liable to third parties
in the same manner as general partners.
According to Barksdale, the court held that
1. General Partner owes fiduciary duty to the limited partners and to the
partnership.
2. A partner has not a right to prefer his own interest to that of the firm, not
deprive the partnership of a profitable bargain by taking to his own
account.
3. The rule is especially true when considering a general partners duty to its
limited partners since the general partner has complete authority to deal
with the partnership business.
4. The general partner acting in complete control stands in the same fiduciary
capacity to the limited partners as a trustee stands to the beneficiaries of a
trust.