30. Limited Partnerships: rights and Liabilities of General Partner

(1) A General Partner of a Limited Partnership has all the rights and powers required to Exercise its Functions as a General Partner, including those incidentals to the Exercise of the partner’s Functions as a General Partner, subject only to the limitations and Liabilities applying to the partner under the partnership agreement, these Regulations and the Rules.

(2) A General Partner of a Limited Partnership must Exercise all the Functions necessary for, and connected with, the conduct of the partnership’s business, purpose or activity, and must discharge all obligations imposed on a General Partner, in the partner’s capacity as a General Partner of the partnership or on the partnership itself, unless otherwise provided under the partnership agreement, these Regulations or the Rules.

(3) A General Partner of a Limited Partnership must not, without the prior Written consent of all the Limited Partners:

1. (a) do anything that restricts, in any way, the partnership’s ability to conduct its business, purpose or activity in accordance with the partnership agreement; or
2. (b) use or dispose of any partnership property, or any rights in partnership property, for a purpose other than those permitted under the partnership agreement, these Regulations or the Rules, unless immediate action is required in the best interest of all the Partners.

(4) If immediate action is taken as mentioned in subsection (3)(b) without prior Written consent of all the Limited Partners, the General Partners must take all reasonable steps to have all the Limited Partners ratify the action as soon as possible.

(5) Any property of a Limited Partnership that is transferred to, vested in or held on behalf of any 1 or more of the General Partners, or that is transferred into or vested in the name of the partnership, must be held (or taken to be held) by the General Partner (or, if by 2 or more General Partners, by the General Partners jointly) as an asset of the partnership in accordance with the terms of the partnership agreement.

(6) Any Liability incurred by a General Partner of a Limited Partnership in the conduct of the partnership’s business, purpose or activity is a Liability of the partnership.

(7) Each General Partner of a Limited Partnership is liable in the insolvency of the partnership for all of the partnership’s Liabilities.

31. Limited Partnerships: rights and Liabilities of Limited Partner

(1) A Limited Partner of a Limited Partnership has the same rights as a General Partner:

1. (a) during business hours, to inspect and make copies of, or take extracts from, the partnership’s books and other Records; and
2. (b) to be given on request, true and full information of everything affecting the partnership and to be given a formal account of partnership affairs whenever just and reasonable.

(2) A Limited Partner of a Limited Partnership is not entitled to dissolve the partnership by notice.

(3) Subject to any provision, express or implied, of the partnership agreement of a Limited Partnership to the contrary, the partnership is not dissolved by:

1. (a) the death, legal incapacity, bankruptcy, or withdrawal from the partnership, of a Limited Partner who is an individual or
2. (b) the dissolution, insolvency, winding up, or withdrawal from the partnership, of a Limited Partner that is a body corporate.

32. Limited Partnerships: share of profits of Limited Partner

(1) Subject to the terms of the partnership agreement of a Limited Partnership, these Regulations or the Rules, a Limited Partner has the right to a share of the partnership’s profits.

(2) A Limited Partner of a Limited Partnership must not be paid the share of the profits provided by the partnership agreement, or any part of it, if the General Partners should reasonably believe that the partnership is not able, or will not be able for the next 12 months after the share of the profits is paid, to meet its debts as and when they fall due in the normal course of business.

(3) If an amount is paid to a Limited Partner of a Limited Partnership in Contravention of subsection (2), the amount is a debt owing by the Limited Partner to the partnership and is immediately repayable.

33. Limited Partnerships: dealings by Limited Partner with partnership

(1) A Limited Partner of a Limited Partnership may lend money to borrow money from, and enter into transactions with, the partnership, except so far as otherwise provided in the partnership agreement.

(2) If a Limited Partner of a Limited Partnership borrows money from the partnership and proceedings to dissolve the partnership are commenced, the amount that has not been repaid by the partner must be immediately repaid by the partner to the partnership.

34. Limited Partnerships: rights of Limited Partners among themselves

Limited Partners of a Limited Partnership rank, in relation to one another:

• (a) equally in relation to the return of their contributions; and
• (b) pro rata to their contributions in relation to profits.

35. Limited Partnerships: rights of Limited Partners to return of contributions

(1) A Limited Partner of a Limited Partnership has a right to claim the return of all or part of the partner’s contribution:

• (a) on the dissolution of the partnership, but subject to subsection (2); or
• (b) in accordance with any provision included in the partnership agreement relating to its return, but only if the General Partners should reasonably believe that the partnership is able, and will be for the next 12 months after the contribution is returned be able, to meet its debts as and when they fall due in the normal course of business.

(2) If the Limited Partnership is dissolved, a Limited Partner must not be allowed to claim, or otherwise withdraw, any part of the partner’s contribution until the claims of all the other Creditors of the partnership, and all charges on it, have been fully paid or satisfied.

(3) In this section, a reference to the return of the contribution of a Limited Partner of a Limited Partnership includes a reference to the release of any obligation of the partner forming part of the capital contribution.

36. Limited Partnerships: liability of Limited Partners to Creditors

(1) A Limited Partner of a Limited Partnership is not liable for the partnership’s Liabilities.

(2) However, if a Limited Partner of a Limited Partnership participates in the partnership’s management in its dealings with Persons who are not Partners, the Limited Partner is liable for all Liabilities of the partnership incurred during the period that the Limited Partner participates in the partnership’s management as though the Limited Partner were for that period a General Partner.

(3) A Limited Partner of a Limited Partnership is liable under subsection (2) only to a Person who dealt with the partnership with actual knowledge of the participation of the Limited Partner in the partnership’s management and who then reasonably believed the Limited Partner to be a General Partner.

(4) For this section, a Limited Partner of a Limited Partnership does not participate in the management of the partnership only by doing 1 or more of the following:

• (a) being a contractor for, or an agent or employee of, the partnership or of a General Partner, or acting as a director, officer or shareholder of a corporate General Partner, if the capacity in which the Limited Partner is acting is made clear to any third party dealing with the partnership;
• (b) consulting with and advising a General Partner in relation to the partnership’s activities, including being an advisory member of an investment or other committee;
• (c) investigating, reviewing, approving, or being advised about, the partnership’s accounts or affairs or exercising any right given to a Limited Partner by these Regulations or the Rules;
• (d) acting as surety or guarantor for the partnership, either generally or in relation to specific obligations;
• (e) approving or disapproving an amendment of the partnership agreement;
• (f) voting on, or otherwise signifying approval or disapproval of, 1 or more of the following:

(i) the dissolution and winding up of the partnership;

(ii) the purchase, sale, exchange, lease, pledge, hypothecation, creation of a security interest, or other dealing in, any asset by or of the partnership;

(iii) the creation or renewal of an obligation by the partnership;

(iv) a change in the nature of the activities of the partnership;

(v) the admission, removal, or withdrawal, of a General Partner or Limited Partner, and the continuation of the partnership afterwards;

(vi) transactions in which 1 or more of the General Partners have an actual or potential conflict of interest with 1 or more of the Limited Partners;

(vii) instituting a legal proceeding on behalf of the partnership under section 43(3) (Limited Partnerships: legal proceedings and service of Documents) and taking subsequent steps in relation the proceeding.

(5) Subsection (4) does not imply that the possession or exercise of any other power by a Limited Partner of a Limited Partnership is necessarily the participation by the partner in the partnership’s management.

37. Limited Partnerships: Liabilities of incoming and outgoing Partners

(1) A Person who is admitted as a Partner, otherwise than by assignment, to an existing Limited Partnership does not become liable to the Creditors of the partnership for anything done before the Person became a Partner.

(2) An outgoing Partner of a Limited Partnership is not liable for the Liabilities incurred by the partnership after the Partner ceases to be a Partner.

(3) An outgoing Partner, or the estate of a deceased Partner, of a Limited Partnership may be discharged, by agreement with the partnership, from any Liabilities existing on the day the Partner ceased to be a Partner.