Rights and duties of partners

The rights and duties of the partners in relation to the partnership shall be determined, subject to any agreement between them, by the following rules: (1) Each partner shall be repaid his or her contributions, whether by way of capital or advances to the partnership property and share equally in the profits and surplus remaining after all liabilities, including those to partners, are satisfied; and, except as provided in subsection (b) of Code Section 14-8-15, must contribute towards the losses, whether of capital or otherwise, sustained by the partnership according to his or her share in the profits; 896 14-8-18 (2) The partnership must indemnify every partner in respect of payments made and personal liabilities reasonably incurred by him in the ordinary and proper conduct of its business, or for the preservation of its business or property; (3) A partner, who in aid of the partnership makes any payment or advance beyond the amount of capital which he agreed to contribute, shall be paid interest from the date of the payment or advance; (4) A partner shall receive interest on the capital contributed by him only from the date when repayment should be made; (5) All partners have equal rights in the management and conduct of the partnership business; (6) No partner is entitled to remuneration for acting in the partnership business, except that a surviving partner is entitled to reasonable compensation for his services in winding up the partnership affairs; (7) No person can become a member of a partnership without the consent of all the partners; (8) Any difference arising as to ordinary matters connected with the partnership business may be decided by a majority of the partners; but no act in contravention of any agreement between the partners may be done rightfully without the consent of all the partners. (Code 1981, § 14-8-18, enacted by Ga. L. 1984, p. 1439, § 1; Ga. L. 1995, p. 470, § 4.) COMMENT Note to Uniform Partnership Act This section states basic rules regarding financial and management rights and duties as between the partners, subject to their contrary agreement. Prior Georgia Law Subsection (1): Prior O.C.G.A. § 14-8-45 was generally consistent. Subsection (2): There was no precisely comparable provision. The general provision regarding contribution, O.C.G.A. § 23-2-71, is consistent, except that it permits the paying partner to recover from individual partners instead of the partnership and applies only to sums actually paid. Subsection (3): There was no comparable provision. Prior case law was inconsistent. See McAllister v. Payne, 108, Ga. 517, 34 S.E. 165 (1899). Subsection (4): There was no comparable provision. Prior case law was consistent. See Tutt v. Land, 50 Ga. 339, 350 (1873). Subsection (5): There was no comparable provision. Prior O.C.G.A. § 14-8-41 provided generally that partners had ‘‘joint possession’’ of partnership effects. This term was not clearly defined in the case law. 897 14-8-18 CORPORATIONS & PARTNERSHIPS 14-8-18 Subsection (6): There was no comparable provision. Prior case law was consistent as to compensation for pre-dissolution services. See Maynard v. Maynard, 147 Ga. 178, 93 S.E. 289 (1917). Subsection (7): Prior O.C.G.A. § 14-8-43 was consistent. Subsection (8): Prior O.C.G.A. § 14-8-42 was consistent. Official UPA This section is the same as the official version. Cross-References Definition of ‘‘interest’’: § 14-8-2(5). Power of Partners to bind the partnership in transactions with third parties: § 14-8-9. Partner’s liability for partnership obligations: § 14-8-15. Partner’s management rights as property right of partner: § 14-8-24. Partner’s share of profits as interest in partnership: § 14-8-26.