What are the Property Rights of a Partner? (Articles 1810-1814, Civil Code)

Summary

Attorney Marie Chris Batol Laskow discusses property rights of partners in a partnership under civil code articles 1810-1814. She explains a partner's rights to specific partnership property, their interest in the partnership's profits and surplus, and their management participation. The script clarifies that these rights are limited to partnership purposes and are not assignable to third parties without all partners' consent. It also covers the assignability of a partner's interest and the remedies available to creditors, including charging orders and the sale of a partner's interest.

Takeaways

• 📚 The video is aimed at simplifying the law, focusing on property rights of a partner in a partnership as outlined in articles 1810 to 1814 of the civil code.
• 🏢 A partner has three property rights: rights in specific partnership property, interest in the partnership, and the right to participate in management.
• 🤝 A partner is a co-owner of specific partnership property, with equal rights to use or possess it, but only for partnership purposes.
• 🚫 A partner's right to specific partnership property is not assignable to third persons, except with the agreement of all partners.
• 💼 The right to specific partnership property is also not subject to attachment or execution for personal debts, only for partnership debts.
• 💵 A partner's interest in the partnership refers to their share of the profits during the partnership's life and any surplus after dissolution.
• 🔄 A partner's interest in the partnership can be assigned, unlike their right to specific property, which is more limited.
• 📉 If a partner assigns their interest, it does not dissolve the partnership or give the assignee management rights, except in cases of fraud.
• 📈 A partner's interest in the partnership can be subject to a charging order by a separate judgment creditor, allowing the creditor to receive the partner's share of profits.
• 🛡️ Other remedies for a creditor of a partner's debt include the appointment of a receiver to conserve the debtor partner's share or the sale of the debtor partner's interest.
• 🔄 If a partner's interest is sold, other partners have the right to redeem it, holding it in trust for the debtor partner.

Q & A

What are the property rights of a partner in a partnership according to the script?

The property rights of a partner in a partnership include: 1) Rights in specific partnership property, 2) Interest in the partnership, and 3) Right to participate in the management.

What does a partner's right in specific partnership property entail?

A partner's right in specific partnership property means they are a co-owner of tangible assets like buildings or cars owned by the partnership, with an equal right of possession for partnership purposes only.

Can a partner use specific partnership property for personal purposes?

No, a partner can only use specific partnership property for partnership purposes and not for personal use.

What can a partner do if they are excluded from using partnership property for partnership purposes?

If a partner is excluded from using partnership property for partnership purposes, they can demand a formal accounting from the partners in the partnership.

Is a partner's right in specific partnership property assignable to third persons?

A partner's right in specific partnership property is generally not assignable to third persons, except when all partners agree to assign it.

What are the consequences if a partner's right in specific partnership property is not assignable?

If a partner's right in specific partnership property is not assignable, it ensures that the partnership retains the use of such property and that the partner's personal debts cannot attach to the property.

What is meant by a partner's interest in the partnership?

A partner's interest in the partnership refers to their share in the profits during the life of the partnership and any surplus after dissolution.

Can a partner assign their interest in the partnership?

Yes, a partner can assign their interest in the partnership, which includes their share of profits and surplus.

What happens when a partner assigns their interest in the partnership?

Assigning a partner's interest does not dissolve the partnership or make the assignee a partner. The assignee is only entitled to receive the profits as per the contract with the assigning partner.

What is a charging order as mentioned in the script?

A charging order is a court directive that instead of the partnership giving the share of profits to the partner, it is given to the judgment creditor of that partner.

What remedies are available to a creditor of a partner's debt?

Remedies available to a creditor of a partner's debt include obtaining a charging order from the court or the appointment of a receiver to conserve the debtor partner's share in the partnership.

How can other partners respond to the sale of a debtor partner's interest?

Other partners or the partnership can redeem the interest of the debtor partner that was sold, but they would hold it in trust for the debtor partner to potentially regain their interest in the partnership.