Wisconsin Statutes 179.0409 – Standards of conduct for general partners
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Terms Used In Wisconsin Statutes 179.0409
- Appropriation: The provision of funds, through an annual appropriations act or a permanent law, for federal agencies to make payments out of the Treasury for specified purposes. The formal federal spending process consists of two sequential steps: authorization
- Common law: The legal system that originated in England and is now in use in the United States. It is based on judicial decisions rather than legislative action.
- Fiduciary: A trustee, executor, or administrator.
- Following: when used by way of reference to any statute section, means the section next following that in which the reference is made. See Wisconsin Statutes 990.01
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
- 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.
- Person: includes all partnerships, associations and bodies politic or corporate. See Wisconsin Statutes 990.01
- Property: includes real and personal property. See Wisconsin Statutes 990.01
- Trustee: A person or institution holding and administering property in trust.
(1) A general partner owes to the limited partnership and, subject to s. 179.0901, the other partners the duties of loyalty and care stated in subs. (2) and (3).
(2) The fiduciary duty of loyalty of a general partner includes all of the following duties:
(a) The duty to account to the limited partnership and hold as trustee for it any property, profit, or benefit derived by the general partner in or from any of the following:
1. The conduct or winding up of the partnership’s activities and affairs.
2. A use by the general partner of the partnership’s property.
3. The appropriation of a partnership opportunity.
(b) The duty to refrain from dealing with the partnership in the conduct or winding up of the partnership’s activities and affairs as or on behalf of a person having an interest adverse to the partnership.
(c) The duty to refrain from competing with the partnership in the conduct or winding up of the partnership’s activities and affairs.
(3) The duty of care of a general partner in the conduct or winding up of the limited partnership’s activities and affairs is to refrain from engaging in grossly negligent or reckless conduct or in conduct for which relief or exoneration from liability is not permitted under s. 179.0105 (3) (h).
(4) A general partner shall discharge the duties and obligations under this chapter or under the partnership agreement and exercise any rights thereunder consistently with the contractual obligation of good faith and fair dealing.
(5) A general partner does not violate a duty or obligation under this chapter or under the partnership agreement solely because the general partner’s conduct furthers the general partner’s own interest.
(6) All the partners of a limited partnership, or one or more disinterested partners with authority to act in the matter, may authorize or ratify, after full disclosure of all material facts, a specific act or transaction by a general partner that otherwise would violate the duty of loyalty.
(7) It is a defense to a claim under sub. (2) (b) and any comparable claim in equity or at common law that the transaction was fair to the limited partnership.
(8) If, as permitted by sub. (6) or the partnership agreement, a general partner enters into a transaction with the limited partnership which otherwise would be prohibited by sub. (2) (b), the general partner’s rights and obligations arising from the transaction are the same as those of a person that is not a general partner.