West Virginia Code 47-9-19 – Liability to third parties
(a) Except as provided in subsection (d) of this section, a limited partner is not liable for the obligations of a limited partnership unless he is also a general partner or, in addition to the exercise of his rights and powers as a limited partner, he takes part in the control of the business: Provided, That if the limited partner participates in the control of the business, he is liable only to persons who transact business with the limited partnership reasonably believing, based on the limited partner's conduct, that the limited partner is a general partner.
Terms Used In West Virginia Code 47-9-19
- Amendment: A proposal to alter the text of a pending bill or other measure by striking out some of it, by inserting new language, or both. Before an amendment becomes part of the measure, thelegislature must agree to it.
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Certificate of limited partnership: means the certificate referred to in section eight of this article and the certificate as amended. See West Virginia Code 47-9-1
- Corporation: A legal entity owned by the holders of shares of stock that have been issued, and that can own, receive, and transfer property, and carry on business in its own name.
- General partner: means a person who has been admitted to a limited partnership as a general partner in accordance with the partnership agreement and named in the certificate of limited partnership as a general partner. See West Virginia Code 47-9-1
- in writing: includes any representation of words, letters, or figures, whether by printing, engraving, writing, or otherwise. See West Virginia Code 2-2-10
- Lease: A contract transferring the use of property or occupancy of land, space, structures, or equipment in consideration of a payment (e.g., rent). Source: OCC
- Limited partner: means a person who has been admitted to a limited partnership as a limited partner in accordance with the partnership agreement. See West Virginia Code 47-9-1
- Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
- Partner: means a limited or general partner. See West Virginia Code 47-9-1
- Partnership: A voluntary contract between two or more persons to pool some or all of their assets into a business, with the agreement that there will be a proportional sharing of profits and losses.
- Partnership agreement: means any valid agreement, written or oral, of the partners as to the affairs of a limited partnership and the conduct of its business. See West Virginia Code 47-9-1
(b) A limited partner does not participate in the control of the business within the meaning of subsection (a) of this section solely by doing one or more of the following:
(1) Being a contractor for or an agent or employee of the limited partnership or of a general partner or being an officer, director or shareholder of a general partner that is a corporation;
(2) Consulting with and advising a general partner with respect to the business of the limited partnership;
(3) Acting as surety for the limited partnership or guaranteeing or assuming one or more specific obligations of the limited partnership;
(4) Taking any action required or permitted by law to bring or pursue a derivative action in the right of the limited partnership;
(5) Requesting or attending a meeting of partners;
(6) Proposing, approving or disapproving, by voting or otherwise on one or more of the following matters:
(i) The dissolution and winding up of the limited partnership;
(ii) The sale, exchange, lease, mortgage, pledge or other transfer of all or substantially all of the assets of the limited partnership;
(iii) The incurrence of indebtedness by the limited partnership other than in the ordinary course of its business;
(iv) A change in the nature of the business;
(v) The admission or removal of a general partner;
(vi) The admission or removal of a limited partner;
(vii) A transaction involving an actual or potential conflict of interest between a general partner and the limited partnership or the limited partners;
(viii) An amendment to the partnership agreement or certificate of limited partnership; or
(ix) Matters related to the business of the limited partnership not otherwise enumerated in this subsection (b), which the partnership agreement states in writing may be subject to the approval or disapproval of limited partners;
(7) Winding up the limited partnership pursuant to section forty-six of this article; or
(8) Exercising any right or power permitted to limited partners under this article and not specifically enumerated in this subsection (b).
(c) The enumeration in subsection (b) of this section does not mean that the possession or exercise of any other powers by a limited partner constitutes participation by him in the business of the limited partnership.
(d) A limited partner who knowingly permits his name to be used in the name of the limited partnership, except under circumstances permitted by subdivision (2), section two of this article, is liable to creditors who extend credit to the limited partnership without actual knowledge that the limited partner is not a general partner.