This section is from the book "The Law Of Contracts", by William Herbert Page. Also available from Amazon: Commercial Contracts: A Practical Guide to Deals, Contracts, Agreements and Promises.
Statutes of many states provide for limited partnerships, in which one partner is the general partner, personally liable for all the firm's debts, while the others are special partners, liable only for the amount contributed by them.1 The statute in such cases provides fully for filing a certificate showing the facts about the limited partnership and for publication as a means of giving notice. An attempted limited partnership which does not comply fully with the statute is a general partnership,2 as where publication is omitted,3 or the statutory statement is omitted,4 or does not show the value of the contribution of the special partner as required by statute,5 or is false, as where it omits a mortgage,6 or where it recites that a partner's share is paid in when it is not paid in for a week thereafter.7 An attempted limited partnership becomes a general partnership where the assets on renewal were substantially less than at the original formation,8 or where assets of the old partnership are taken of such a value that it does not leave enough to pay old debts and the new firm assumes some of such debts,9 or where all the property of the old insolvent partnership was set aside as the property of the special partner.10 A limited partnership becomes a general partnership on expiration of the time for which it was formed.11 But under a statute allowing a limited partnership to succeed to a firm name it may succeed to the name of one who becomes a limited partner, even if without such succession the use of his name would have made him a general part-
31 S. E. 479 [citing, Tayloe v. Bush, 75 Ala. 432; Hitchings v. Ellis, 12 Gray (Mass.) 449]. Contra, Pewell v. Surety Co., 80 Miss. 782; 92 Am. St. Rep. 625; 28 So. 755.
8 Potter v. Dredging Co., 59 N. J. Eq. 422; 46 Atl. 537.
1 Robbins Electric Co. v. Weber, 172 Pa. St. 635; 34 Atl. 116.
2 Van Home v. Corcoran, 127 Pa. St. 255; 4 L. R. A. 386; 18 Atl. 16; Ussery v. Crusman (Tenn. Ch. App.), 47 S. W. 567.
3 Davis v. Sanderlin, 119 N. C. 84; 25 S. E. 815.
4 Spencer, etc., Co. v. Johnson, 53 S. C. 533; 31 S. E. 392.
5 Blumenthal v. Whitaker, 170 Pa. St. 309; 33 Atl. 103 (where a reference to an appraisement of such contribution filed in court was held insufficient ).
6 First National Bank v. Creve-ling. 177 Pa. St. 270; 35 Atl. 595.
7 Myers v. Electric Co., 59 N. J. L. 153; 35 Atl. 1069.
8 Durgin v. Colburn, 176 Mass. 110; 57 N. E. 213.
9 Lee v. Burnley, 195 Pa. St. 58; 45 Atl. 668.
10 Fourth Street National Bank V. Whitaker, 170 Pa. St. 29V; 33 Atl. 100.