S 996 Session 110 (1993-1994)
S 0996 General Bill, By Passailaigue and M.T. Rose
A Bill to amend Section 33-41-20, Code of Laws of South Carolina, 1976,
relating to definitions in regard to the Uniform Partnership Act, so as to
define "registered limited liability partnership"; to amend Section 33-41-210,
relating to the definition of a partnership and its application to limited
partnerships, so as to include within this definition registered limited
liability partnerships; to amend Section 33-41-370, relating to the nature of
a partner's liability, so as to further provide for this liability; to amend
Section 33-41-510, relating to rules determining the rights and duties of
partners in relation to the partnership, so as to revise the manner in which
each partner shall contribute toward the partnership's losses; to amend
Section 33-41-960, relating to the liability of a partner for the acts of
other partners after dissolution, so as to further provide for this liability;
to amend Section 33-41-1010, relating to the effect of dissolution on the
existing liability of a partner, so as to revise the obligations of the
partnership for which the individual property of a deceased partner may be
liable; to amend Section 33-41-1060, relating to the settlement of accounts
between partners and the rules for distribution, so as to further provide for
what constitutes the assets of the partnership and certain contributions which
the partners are required to make; and to add Sections 33-41-1110 through
33-41-1130 so as to provide for the formation, registration, and regulation of
registered limited liability partnerships.
01/11/94 Senate Introduced and read first time SJ-61
01/11/94 Senate Referred to Committee on Judiciary SJ-61
A BILL
TO AMEND SECTION 33-41-20, CODE OF LAWS OF SOUTH
CAROLINA, 1976, RELATING TO DEFINITIONS IN REGARD TO
THE UNIFORM PARTNERSHIP ACT, SO AS TO DEFINE
"REGISTERED LIMITED LIABILITY PARTNERSHIP";
TO AMEND SECTION 33-41-210, RELATING TO THE DEFINITION
OF A PARTNERSHIP AND ITS APPLICATION TO LIMITED
PARTNERSHIPS, SO AS TO INCLUDE WITHIN THIS DEFINITION
REGISTERED LIMITED LIABILITY PARTNERSHIPS; TO AMEND
SECTION 33-41-370, RELATING TO THE NATURE OF A
PARTNER'S LIABILITY, SO AS TO FURTHER PROVIDE FOR
THIS LIABILITY; TO AMEND SECTION 33-41-510, RELATING TO
RULES DETERMINING THE RIGHTS AND DUTIES OF
PARTNERS IN RELATION TO THE PARTNERSHIP, SO AS TO
REVISE THE MANNER IN WHICH EACH PARTNER SHALL
CONTRIBUTE TOWARD THE PARTNERSHIP'S LOSSES; TO
AMEND SECTION 33-41-960, RELATING TO THE LIABILITY OF
A PARTNER FOR THE ACTS OF OTHER PARTNERS AFTER
DISSOLUTION, SO AS TO FURTHER PROVIDE FOR THIS
LIABILITY; TO AMEND SECTION 33-41-1010, RELATING TO
THE EFFECT OF DISSOLUTION ON THE EXISTING LIABILITY
OF A PARTNER, SO AS TO REVISE THE OBLIGATIONS OF THE
PARTNERSHIP FOR WHICH THE INDIVIDUAL PROPERTY OF A
DECEASED PARTNER MAY BE LIABLE; TO AMEND SECTION
33-41-1060, RELATING TO THE SETTLEMENT OF ACCOUNTS
BETWEEN PARTNERS AND THE RULES FOR DISTRIBUTION,
SO AS TO FURTHER PROVIDE FOR WHAT CONSTITUTES THE
ASSETS OF THE PARTNERSHIP AND CERTAIN
CONTRIBUTIONS WHICH THE PARTNERS ARE REQUIRED TO
MAKE; AND TO ADD SECTIONS 33-41-1110 THROUGH
33-41-1130 SO AS TO PROVIDE FOR THE FORMATION,
REGISTRATION, AND REGULATION OF REGISTERED LIMITED
LIABILITY PARTNERSHIPS.
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. Section 33-41-20 of the 1976 Code is amended to read:
"Section 33-41-20. As used in this chapter:
(1) `Court' includes every court and judge having jurisdiction in the
case;
(2) `Business' includes every trade, occupation, or
profession;
(3) `Bankrupt' includes a bankrupt under the Federal Bankruptcy Act
or an insolvent under any state insolvent act;
(4) `Conveyance' includes every assignment, lease,
mortgage, or encumbrance; and
(5) `Real property' includes land and any interest or estate in
land.; and
(6) `Registered limited liability partnership' includes a partnership
formed pursuant to an agreement governed by the laws of this State,
registered under Section 33-41-1110 and complying with Sections
33-41-1120 and 33-41-1140."
SECTION 2. Section 33-41-210 of the 1976 Code is amended to read:
"Section 33-41-210. A `partnership' is an association of two
or more persons to carry on as co-owners a business for profit and
includes, for all purposes of the laws of this State, a registered limited
liability partnership. But However, any association
formed under any other statute of this State or any statute adopted by
authority, other than the authority of this State, is not a partnership under
this chapter unless such the association would have
been a partnership in this State prior to before the
adoption of this chapter on February 13, 1950.
But this This chapter shall apply to limited
partnerships except in so far as the statutes relating to such
the partnerships are inconsistent herewith with the
provisions of this chapter."
SECTION 3. Section 33-41-370 of the 1976 Code is amended to read:
"Section 33-41-370. (1) Except as provided by item (2) of
this section, All all partners are liable jointly and
severally for everything chargeable to the partnership.
(2) Subject to item (3) of this section, a partner in a registered
limited liability partnership is not liable directly or indirectly, including
by way of indemnification, contribution, or otherwise, for debts,
obligations, and liabilities chargeable to the partnership arising from
negligence, wrongful acts, or misconduct committed while the
partnership is a registered limited liability partnership and in the course
of the partnership business by another partner or an employee, agent, or
representative of the partnership.
(3) Item (2) of this section shall not affect the liability of a partner
in a registered limited liability partnership for his own negligence,
wrongful acts, or misconduct, or that of a person under his direct
supervision and control."
SECTION 4. Section 33-41-510(1) of the 1976 Code is amended to
read:
"(1) each partner shall be repaid his contributions, whether by
way of capital or advances to the partnership property, and share equally
in the profits and surplus remaining after all liabilities, including those
to partners, are satisfied. And Except as provided in Section
33-41-370(2), each partner must shall contribute
toward the losses, whether of capital or otherwise, sustained by the
partnership according to his share in the profits;"
SECTION 5. Section 33-41-960 of the 1976 Code is amended to read:
"Section 33-41-960. When the dissolution is caused by the act,
death, or bankruptcy of a partner, each partner is liable to his
copartners for his share of any liability created by any a
partner acting for the partnership as if the partnership had not been
dissolved unless:
(1) the dissolution being by act of any a partner, the
partner acting for the partnership had knowledge of the dissolution;
or
(2) the dissolution being by the death or bankruptcy of a partner, the
partner acting for the partnership had knowledge or notice of the death
or bankruptcy.; or
(3) the liability is for a debt, obligation, or liability for which the
partner is not liable as provided in Section 33-41-370(2)."
SECTION 6. Section 33-41-1010(4) of the 1976 Code is amended to
read:
"(4) The individual property of a deceased partner
shall must be liable for all those
obligations of the partnership incurred while he was a partner and
for which he was liable under Section 33-41-370 but subject to the
prior payment of his separate debts."
SECTION 7. Section 33-41-1060 of the 1976 Code is amended to
read:
"Section 33-41-1060. In settling accounts between the partners
after dissolution the following rules shall must be
observed, subject to any agreement to the contrary:
(1) the assets of the partnership are:
(a) the partnership property and
(b) the contributions of the partners necessary for the payment
of all the liabilities specified in item (2) (4) of this
section;
(2) the liabilities of the partnership shall rank in order of payment,
as follows:
(a) those owing to creditors other than partners,
(b) those owing to partners other than for capital and profits,
(c) those owing to partners in respect of capital, and
(d) those owing to partners in respect of profits;
(3) the assets shall must be applied in the order of
their declaration in item (1) of this section to the satisfaction of the
liabilities;
(4) except as provided in Section 33-41-370(2):
(a) the partners shall contribute, as provided by Section
33-41-510, the amount necessary to satisfy the liabilities; but if
and
(b) if any, but not all, of the partners are insolvent or, not
being subject to process, refuse to contribute, the other partners shall
contribute their share of the liabilities and, in the relative proportions in
which they share the profits, the additional amount necessary to pay the
liabilities;
(5) an assignee for the benefit of creditors or any person appointed
by the court shall have the right to enforce the contributions specified in
item (4) of this section;
(6) any partner or his legal representative shall have the right to
enforce the contributions specified in item (4) of this section to the
extent of the amount which he has paid in excess of his share of the
liability;
(7) the individual property of a deceased partner shall
must be liable for the contributions specified in item (4) of this
section;
(8) when partnership property and the individual properties of the
partners are in possession of a court for distribution, partnership
creditors shall have priority on partnership property and separate
creditors on individual property, saving the rights of lien or secured
creditors as heretofore provided by law; and
(9) when a partner has become bankrupt or his estate is insolvent the
claims against his separate property shall must rank in
the following order:
(a) those owing to separate creditors,
(b) those owing to partnership creditors, and
(c) those owing to partners by way of contribution."
SECTION 8. Title 33, Chapter 41 of the 1976 Code is amended by
adding:
"Section 33-41-1110. (1) To become and to continue as a
registered limited liability partnership, a partnership shall file with the
Secretary of State an application or a renewal application, as the case
may be, stating the name of the partnership; the address of its principal
office, if the partnership's principal office is not located in this State; the
address of a registered office, and the name and address of a registered
agent for service of process in this State, which the partnership will be
required to maintain; the number of partners; a brief statement of the
business in which the partnership engages, and that the partnership
applies for status or renewal of its status, as the case may be, as a
registered limited liability partnership.
(2) The application or renewal application must be executed by a
majority in interest of the partners or by one or more partners authorized
to execute an application or renewal application.
(3) The application or renewal application must be accompanied by
a fee of one hundred dollars.
(4) The Secretary of State shall register as a registered limited
liability partnership, and shall renew the registration of any registered
limited liability partnership, any partnership that submits a completed
application or renewal application with the required fee.
(5) Registration is effective for one year after the date an application
is filed, unless voluntarily withdrawn by filing with the Secretary of
State a written withdrawal notice executed by a majority in interest of
the partners or by one or more partners authorized to execute a
withdrawal notice. Registration, whether pursuant to an original
application or a renewal application, as a registered limited liability
partnership is renewed if, during the sixty-day period preceding the date
the application or renewal application otherwise would have expired, the
partnership files with the Secretary of State a renewal application. A
renewal application expires one year after the date an original
application would have expired if the last renewal of the application had
not occurred.
(6) The status of a partnership as a registered limited liability
partnership may not be affected by changes after the filing of an
application or a renewal application in the information stated in the
application or renewal application.
(7) The Secretary of State may provide forms for application for or
for renewal of registration.
Section 33-41-1120. The name of a registered limited liability
partnership must contain the words `Registered Limited Liability
Partnership' or the abbreviation `L.L.P.' as the last words or letters of its
name.
Section 33-41-1130 (1) A partnership, including a registered limited
liability partnership, formed and existing under this chapter, may
conduct its business, carry on its operations, and have and exercise the
powers granted by this chapter in any state, territory, district, or
possession of the United States or in any foreign country.
(2) It is the intent of the General Assembly that the legal existence
of registered limited liability partnerships formed and existing under this
chapter be recognized outside the boundaries of this State and that the
laws of this State governing such registered limited liability partnerships
be granted the protection of full faith and credit under the Constitution
of the United States.
(3) It is the policy of this State that the internal affairs of
partnerships, including registered limited liability partnerships, formed
and existing under this chapter, including the liability of partners for
debts, obligations, and liabilities chargeable to partnerships, shall be
subject to and governed by the laws of this State.
(4) It is also the policy of this State that the internal affairs of
partnerships, including registered limited liability partnerships, formed
and existing under the laws of another jurisdiction, including the liability
of partners for debts, obligations, and liabilities chargeable to
partnerships, shall be subject to and governed by the laws of such other
jurisdiction.
(5) Subject to any provisions of law for the regulation and control
of specific types of businesses, registered limited liability partnerships
formed and existing under the laws of another jurisdiction may do
business in this State and are not required to register with the Secretary
of State under this chapter."
SECTION 9. This act takes effect upon approval by the Governor.
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