Dictionary of Law

limited partnership :: legal definition

Limited partnership - n. a special type of partnership which is very common when people need funding for a business, or when they are putting together an investment in a real estate development. A limited partnership requires a written agreement between the business management, who is (are) general partner or partners, and all of the limited partners. Each limited partner makes an investment of funds into the partnership and is supposed to receive a pre-stated share of the profit, which is ordinarily greater than that of each of the general partners up to a point (such as return of the investment), and, thereafter, the limited partners will receive a lesser share than the general partner(s). The limited partners also will receive the tax benefit of a "passed through" loss (a personal income tax deduction for part of the loss) during the development stages of the partnership when the expenses exceed any receipts. Quite often there is also a provision for eventual buy-out of the limited partners by the general partner(s). The limited partners may not participate in the management decisions of the partnership or they will lose their limited partnership status. They do have the power to vote to remove the general partner(s), although usually the partnership agreement is structured so that such removal is virtually impossible unless the general partner in question has committed fraud. Since the limited investors have no control of the conduct over the partnership, they should make sure they have considerable knowledge about the reputation and record of the general partner(s) and the type of business. In fact, state laws require that there be some pre-existing acquaintanceship between the general and the limited partners or a detailed prospectus provided by the general partner(s) meeting very stringent and specific federal requirements of disclosure. The maximum number of limited partners is set by state law to prevent using interests in the limited partnership as if they were shares of stock in a corporation. In addition to priority in profit, tax deductions, and potential share in the success of the enterprise, the limited partner is "limited" in potential loss, since all he/she can lose is his/her investment, and the general partners alone are subject to claims, debts in bankruptcy and lawsuits against the partnership. Limited partnerships must file their name and names and addresses of general partners with the Secretary of State or other designated officer in the state in which the partnership is created so the public can find out who the responsible parties are. Like a corporation, a limited partnership may not have a name which is too similar to another limited partnership or corporation.

See also: corporation general partner limited liability partner partnership and Related Law Terms ↓

Related Law Terms

accounts receivable :: n. the amounts of money due or owed to a business ... sidering the chances of collection.
acknowledgment :: n. the section at the end of a document where a no ... me leases and various other papers.
administrative law :: n. the procedures created by administrative agenci ... judge Administrative Procedure Act
administrator :: n. the person appointed by the court to handle the ... e also: administer executor probate
adoption :: n. the taking of a child into one's family, creati ... the child are met. See also: adopt
advisory opinion :: n. an opinion stated by a judge or a court upon th ... o: actual controversy friendly suit
agent for acceptance of service :: n. states require that a corporation name an actua ... corporations. See also: corporation
answer :: n. in law, a written pleading filed by a defendant ... emurrer general denial verification
antitrust laws :: n. acts adopted by Congress to outlaw or restrict ... so: price fixing restraint of trade
appeal :: 1) v. to ask a higher court to reverse the decisio ... ng, as in "he has filed an appeal."
appearance :: n. the act of a party or an attorney showing up in ... neral appearance special appearance
articles of incorporation :: n. the basic charter of a corporation which spells ... year's taxes. See also: corporation
attachment :: n. the seizing of money or property prior to getti ... bond. See also: writ of attachment
attorney :: n. 1) an agent or someone authorized to act for an ... ialize. See also: court reciprocity
Attorney General :: n. in each state and the federal government the hi ... izenry. See also: Solicitor General
bad debt :: n. an uncollectible debt. The problem is to determ ... ust no income on which to be taxed.
bank :: n. 1) an officially chartered institution empowere ... erred to as "in bank" or "en banc."
bankruptcy :: n. a federal system of statutes and courts which p ... y proceedings trustee in bankruptcy
bar examination :: n. the examination given in each state by either t ... n that district. See also: attorney
Bill of Rights :: n. the first ten amendments to the federal Constit ... ved to the states or to the people.
blue sky laws :: n. laws intended to protect the public from purcha ... e sky." See also: corporation stock
brief :: 1) n. a written legal argument, usually in a forma ... another person. See also: precedent
capital gains :: n. the difference between the sales price and the ... so: basis delayed exchange exchange
carrier :: n. in general, any person or business which transp ... lso: common carrier private carrier
cartel :: n. 1) an arrangement among supposedly independent ... Colombia. See also: antitrust laws
case system :: n. the method of studying law generally used in Am ... Langdell and soon became standard.
charitable remainder trust (Charitable Remainder Irrevocable Unitrust) :: n. a form of trust in which the donor (trustor or ... ed up or committed. See also: trust
chattel mortgage :: n. an outmoded written document which made a chatt ... ed by the property. See also: UCC-1
child custody :: n. a court's determination of which parent, relati ... pport custody divorce joint custody
child support :: n. court-ordered funds to be paid by one parent to ... ild custody divorce spousal support
civil :: adj. 1) that part of the law that encompasses busi ... also: civil liberties civil rights
civil law :: n. 1) a body of laws and legal concepts which come ... generic term for non-criminal law.
clean hands doctrine :: n. a rule of law that a person coming to court wit ... ices. See also: affirmative defense
commingling :: n. the act of mixing the funds belonging to one pa ... rust accounts for funds of another.
common area :: n. in condominium and some cooperative housing pro ... tage of total store space occupied.
common law :: n. the traditional unwritten law of England, based ... plied without reference to statute.
common stock :: n. stock in a corporation in which dividends (payo ... oration preferred stock share stock
community property :: n. property and profits received by a husband and ... and distribution separate property
company :: n. any formal business entity for profit, which ma ... s a corporation. See also: business
complaint :: n. the first document filed with the court (actual ... g prayer service of process summons
conflict of interest :: n. a situation in which a person has a duty to mor ... a position adverse to the customer.
conflict of law :: n. a situation in which both state and federal law ... y arose. See also: forum preemption
conservator :: n. a guardian and protector appointed by a judge t ... ies. See also: conservatee guardian
consortium :: n. 1) a group of separate businesses or business p ... oney terms is a difficult question.
constitution :: n. the fundamental, underlying document which esta ... ts common law constitutional rights
constitutional rights :: n. rights given or reserved to the people by the U ... e also: Bill of Rights constitution
consumer protection laws :: n. almost all states and the federal government ha ... rranty product liability securities
contingent fee :: n. a fee to a lawyer which will be due and payable ... epend on the outcome are unethical.
contract :: 1) n. an agreement with specific terms between two ... n oral contract unilateral contract
contribution :: n. 1) donation to a charity or political campaign. ... f $3,000 from each of his partners.
controlling law :: n. the laws of the state which will be relied upon ... will be that of a particular state.
cooperative :: n. an association of individual businesses, farmer ... exes. See also: cooperative housing
copartner :: n. one who is a member of a partnership. The prefi ... hip." See also: partner partnership
corporate opportunity :: n. a business opportunity which becomes known to a ... ative action fiduciary relationship
corporation :: n. an organization formed with state governmental ... ation public corporation securities
court :: n. 1) the judge, as in "The court rules in favor o ... cost and wait of full court trials.
court-martial :: 1) n. a military court for trying offenses in viol ... the U.S. Court of Military Appeals.
d.b.a. :: n. short for "doing business as," when a person or ... that is registered with the state.
damages :: n. the amount of money which a plaintiff (the pers ... liquidated damages special damages
declaration of trust :: n. the document signed by a trustor (settlor) crea ... also: settlor trust trustee trustor
demurrer :: n. (dee-muhr-ur) a written response to a complaint ... demurrer. See also: motion pleading
derivative action :: n. a lawsuit brought by a corporation shareholder ... on director shareholder stockholder
descent :: n. the rules of inheritance established by law in ... on inheritance intestate succession
discrimination :: n. unequal treatment of persons, for a reason whic ... qual rights. See also: civil rights
dissolution of corporation :: n. termination of a corporation, either a) volunta ... e government. See also: corporation
dividend :: n. a portion of profit, usually based on the numbe ... . See also: corporation shareholder
divorce :: 1) n. the termination of a marriage by legal actio ... y separate property spousal support
doing business :: v. carrying on the normal activities of a corporat ... oration operating within the state.
ejusdem generis :: (eh-youse-dem generous) v adj. Latin for "of the s ... t was of land-based transportation.
element :: n. 1) an essential requirement to a cause of actio ... of action crime general plan zoning
eminent domain :: n. the power of a governmental entity (federal, st ... ngs. See also: condemn condemnation
entrapment :: n. in criminal law, the act of law enforcement off ... e drugs if not pressed by the narc?
equal opportunity :: 1) n. a right supposedly guaranteed by both federa ... be so. See also: affirmative action
equal protection of the law :: n. the right of all persons to have the same acces ... laws." See also: due process of law
equity :: n. 1) a venerable group of rights and procedures t ... ry enjoin equitable injunction writ
estate :: n. 1) all that one owns in real estate and other a ... ife estate probate real estate will
fair trade laws :: n. state laws which permit manufacturers or produc ... state constitutions in many states.
fiduciary :: 1) n. from the Latin fiducia, meaning "trust," a p ... lation fiduciary relationship trust
file :: 1) v. to deposit with the clerk of the court a wri ... rrespondence and notes on the case.
foreign corporation :: n. a corporation which is incorporated under the l ... tate or Whoopee's designated agent.
franchise :: 1) n. a right granted by the government to a perso ... on property, income or profits tax.
franchise tax :: n. a state tax on corporations or businesses. See ... sinesses. See also: corporation tax
general appearance :: n. an attorney's representation of a client in cou ... case. See also: special appearance
general partner :: n. 1) usually one of the owners and operators of a ... ted partnership partner partnership
generation skipping :: adj., adv. referring to gifts made through trusts ... to a grandchild without a gift tax.
gift :: n. the voluntary transfer of property (including m ... ift tax unified estate and gift tax
goodwill :: n. the benefit of a business having a good reputat ... an unknowing buyer. See also: sale
grandfather clause :: n. 1) a clause in a statute or zoning ordinance (p ... Such laws are now unconstitutional.
guest statute :: n. a state law which sets standards of care by the ... sked to be let out. See also: guest
habeas corpus :: (hay-bee-us core-puss) n. Latin for "you have the ... nality of a state court conviction.
head of household :: n. 1) in federal income tax law, the person filing ... n or daughter. 3) "head of family."
hearsay rule :: n. the basic rule that testimony or documents whic ... interest dying declaration hearsay
impute :: v. 1) to attach to a person responsibility (and th ... also. See also: vicarious liability
incorporate :: v. 1) to obtain an official charter or articles of ... te by reference incorporation stock
inheritance :: n. whatever one receives upon the death of a relat ... intestacy intestate succession will
insanity :: n. mental illness of such a severe nature that a p ... M'Naughten rule temporary insanity
insolvency :: n. 1) the condition of having more debts (liabilit ... the property. See also: bankruptcy
interest :: n. 1) any and all, partial or total right to prope ... nal property real property standing
issue :: 1) n. a person's children or other lineal descenda ... the body incorporation share stock
joint venture :: n. an enterprise entered into by two or more peopl ... s terminated. See also: partnership
judge :: 1) n. an official with the authority and responsib ... ice justice of the peace magistrate
jury :: n. one of the remarkable innovations of the Englis ... hallenge sequester venire voir dire
law :: n. 1) any system of regulations to govern the cond ... um maritime law natural law statute
law book :: n. any of numerous volumes dealing with law, inclu ... : common law law Shepardize statute
lemon law :: n. statutes adopted in some states to make it easi ... still trying" to make it run right.
levy :: 1) v. to seize (take) property upon a writ of exec ... heriff's sale tax writ of execution
libel :: 1) n. to publish in print (including pictures), wr ... libel per se public figure slander
lien :: n. any official claim or charge against property o ... ord's lien mechanic's lien mortgage
limited liability :: n. the maximum amount a person participating in a ... ted damages partnership shareholder
literary property :: n. the writings of an author which entitles him/he ... as copyrighted. See also: copyright
living trust :: n. sometimes called an inter vivos (Latin for "wit ... thrift clause trust trustee trustor
living will :: n. also called "a durable power of attorney," it i ... upport. See also: power of attorney
long-arm statute :: n. law which gives a local state court jurisdictio ... rt jurisdiction over the defendant.
loss of bargain :: n. the inability to complete a sale or other busin ... ned in a lawsuit. See also: damages
mandamus :: (man-dame-us) n. Latin for "we order," a writ (mor ... mandamus. See also: writ of mandate
marital deduction :: n. an estate tax deduction allowed a surviving spo ... community property estate tax trust
marriage :: n. the joining of a male and female in matrimony b ... of time without legal formalities.
Massachusetts Trust :: n. a business in which the investors give manageme ... provide for eventual distribution.
maxims :: n. a collection of legal truisms which are used as ... e and the ordinary habits of life."
mechanic's lien :: n. the right of a craftsman, laborer, supplier, ar ... ll sue for the debt. See also: lien
mercantile law :: n. that broad area of the law (also called commerc ... tion seller Uniform Commercial Code
merger :: n. 1) in corporate law, the joining together of tw ... and taking one, and wife the other.
mortgage :: n. a document in which the owner pledges his/her/i ... losure notice of default trust deed
negligence :: n. failure to exercise the care toward others whic ... gence per se res ipsa loquitur tort
no fault insurance :: n: a type of automobile insurance required of car ... ling lawsuits. See also: negligence
non-profit corporation :: n. an organization incorporated under state laws a ... harity corporation cy pres doctrine
not guilty :: n. 1) plea of a person who claims not to have comm ... t guilty by reason of insanity plea
notary public :: n. a person authorized by the state in which the p ... he state which appoints the notary.
notice :: n. 1) information, usually in writing in all legal ... Thirty-day notice three-day notice
occupy the field :: v. to preempt (monopolize) an area of statutory la ... ertain topics. See also: preemption
officer :: n. 1) a high-level management official of a corpor ... deputy sheriff or federal marshal.
offshore corporation :: n. a corporation chartered under the laws of a cou ... nds in accounts out of the country.
oral contract :: n. an agreement made with spoken words and either ... itten. See also: agreement contract
ostensible agent :: n. a person who has been given the appearance of b ... rent authority ostensible authority
paralegal :: n. a non-lawyer who performs routine tasks requiri ... h less than that for the attorneys.
partner :: n. 1) one of the co-owners and investors in a "par ... ner limited partnership partnership
partnership :: n. a business enterprise entered into for profit w ... partnership partner silent partner
peremptory challenge :: n. the right of the plaintiff and the defendant in ... challenge for cause jury voir dire
power of attorney :: n. a written document signed by a person giving an ... y, as in a real estate transaction.
practice :: 1) n. custom or habit as shown by repeated action, ... s "she practices law in St. Louis."
preemption :: n. the rule of law that if the federal government ... cs control may parallel each other.
preferred stock :: n. a class of shares of stock in a corporation whi ... on stock corporation dividend stock
prenuptial agreement :: n. also called an antenuptial agreement, a written ... been "taken" by a previous spouse.
privileges and immunities :: n. the fundamental rights that people enjoy in fre ... t impinge on constitutional rights.
pro rata :: (proh rat-ah or proh ray-tah) adj. from Latin for ... e year in which he/she holds title.
product liability :: n. the responsibility of manufacturers, distributo ... e known. See also: warrant warranty
promise :: 1) n. a firm agreement to perform an act, refrain ... so: consideration contract covenant
promissory note :: n. a written promise by a person (variously called ... lso: interest obligee obligor usury
prosecute :: v. 1) in criminal law, to charge a person with a c ... rney General prosecution prosecutor
prospectus :: n. a detailed statement by a corporation required ... rporation limited partnership stock
prudent man rule :: n. the requirement that a trustee, investment mana ... (1994). See also: fiduciary trustee
receiver :: n. 1) a neutral person (often a professional trust ... owing they were obtained illegally.
receivership :: n. the process of appointment by a court of a rece ... n receivership." See also: receiver
reformation :: n. the correction or change of an existing documen ... neral partner sues for reformation.
regulations :: n. rules and administrative codes issued by govern ... es usually have similar procedures.
reorganization :: n. the implementation of a business plan to restru ... also: bankruptcy corporation merger
restraint of trade :: n. in antitrust law, any activity (including agree ... also: antitrust laws monopoly trust
review :: n. the judicial consideration of a lower court jud ... ate court reversal reversible error
sanction :: n. 1) a financial penalty imposed by a judge on a ... ction." See also: contempt of court
savings and loan :: n. a banking and lending institution, chartered ei ... vings into the home finance market.
scope of employment :: n. actions of an employee which further the busine ... ter and servant respondeat superior
seal :: n. a device which creates an impression upon paper ... e "sealed," but that is rare today.
search warrant :: n. a written order by a judge which permits a law ... ble cause search search and seizure
securities :: n. generic term for shares of stock, bonds and deb ... ee also: bond debenture share stock
security deposit :: n. a payment required by a landlord from a tenant ... lso: landlord and tenant lease rent
self-dealing :: n. in the stock market, using secret "inside" info ... ederal Securities and Exchange Act.
sentence :: 1) n. the punishment given to a person convicted o ... ence restitution suspended sentence
separate property :: n. in community property states (California, Texas ... pouse. See also: community property
share :: n. 1) a portion of a benefit from a trust, estate, ... n issue of the corporation's stock.
shareholder :: n. the owner of one or more shares of stock in a c ... : corporation shareholders' meeting
shareholders' agreement :: n. an employment agreement among the shareholders ... re only three or four shareholders.
sheriff :: n. the top law enforcement officer for a county, u ... ." See also: bailiff sheriff's sale
shield laws :: n. statutes enacted in some states which declare t ... See also: privileged communication
silent partner :: n. a non-legal term for an investor who puts money ... partner limited partnership partner
speaking demurrer :: n. an attempt to introduce evidence during a heari ... the operation." See also: demurrer
special prosecutor :: n. an attorney from outside of the government sele ... Robert Bork finally discharged Cox.
standing :: n. the right to file a lawsuit or file a petition ... so: actual controversy jurisdiction
state of domicile :: n. the state in which a person has his/her permane ... orated. See also: domicile resident
statute :: n. a federal or state written law enacted by the C ... and proclamations are not statutes.
statute of limitations :: n. a law which sets the maximum period which one c ... ies. See also: demurrer laches toll
stock certificate :: n. printed document which states the name, incorpo ... . See also: corporation share stock
supremacy clause :: n. Article VI, section 2 of the U.S. Constitution, ... f involving a constitutional issue.
tax :: n. a governmental assessment (charge) upon propert ... unified estate and gift tax use tax
toll :: v. 1) to delay, suspend or hold off the effect of ... bridge or take passage on a ferry.
trade fixture :: n. a piece of equipment on or attached to the real ... uch damage. See also: fixture trade
transfer agent :: n. a person or company retained by a corporation t ... stockbroker. See also: share stock
trust :: n. an entity created to hold assets for the benefi ... testamentary trust trustee trustor
ultra vires :: (uhl-trah veye-rehz) adj. Latin for "beyond powers ... it is issued. See also: corporation
unissued stock :: n. a corporation's shares of stock which are autho ... poration share stock treasury stock
use tax :: n. a state tax on goods purchased in another state ... e" tax equivalent to its sales tax.
watered stock :: n. shares of stock of a corporation which have bee ... . See also: corporation share stock
will :: n. a written document which leaves the estate of t ... will and testament probate testator
winding up :: n. liquidating the assets of a corporation or part ... ration cy pres doctrine partnership

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Other Law Terms - L

labor and materials :: (time and materials) n. what some builders or repa ... track of actual labor hours worked.
laches :: n. the legal doctrine that a legal right or claim ... , breach of contract, fraud, etc.).
land :: n. real property, real estate (and all that grows ... See also: real estate real property
landlady :: n. female of landlord or owner of real property fr ... rents or leases. See also: landlord
landlocked :: adj. referring to a parcel of real property which ... which it was created (carved out).
landlord :: n. a person who owns real property and rents or le ... so: lease lessee lessor rent tenant
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landlord's lien :: n. the right of a landlord to sell abandoned perso ... to the ex-tenant and a public sale.
lapse :: 1) v. to fail to occur, particularly a gift made i ... eficiary devisee legatee trust will
larceny :: n. the crime of taking the goods of another person ... : grand larceny petty larceny theft
last antecedent rule :: n. a doctrine of interpretation (construction) of ... o trucks and not boats or tractors.
last clear chance :: n. a rule of law in determining responsibility for ... contributory negligence negligence
last will and testament :: n. a fancy and redundant way of saying "will." Law ... writing another one. See also: will
latent defect :: n. a hidden flaw, weakness or imperfection in an a ... warranty product liability warranty
lateral support :: n. the right of a land- owner to assurance that hi ... support problems are less dramatic.
law :: n. 1) any system of regulations to govern the cond ... um maritime law natural law statute
law and motion calendar :: n. a court calendar in which only motions and spec ... special legal arguments are heard.
law book :: n. any of numerous volumes dealing with law, inclu ... : common law law Shepardize statute
law of admiralty :: n. statutes, customs and treaties dealing with act ... w. See also: Jones Act maritime law
law of the case :: n. once a judge has decided a legal question durin ... he ruling is the "law of the case."