Introduced By: Senator Irons
Date Introduced : February 10, 1998
It is enacted by the General Assembly as follows:
SECTION 1. Sections 7-12-17, 7-12-26, 7-12-56, 7-12-57, 7-12-58, and 7-12-59 of the General Laws in Chapter 7-12 entitled "Partnerships" are hereby amended to read as follows:
7-12-17. Partnership defined. -- (1) A partnership
is an association of two (2) or more persons to carry on as co-owners
a business for profit, and shall include a registered limited
liability {DEL company DEL} {ADD partnership ADD}.
(2) But any association formed under any other statute of this state, or any statute adopted by authority, other than the authority of the state, is not a partnership under sections 7-12-12 -- 7-12-59, inclusive, unless the association would have been a partnership in this state prior to May 6, 1957; but sections 7-12-12 -- 7-12-59, inclusive, shall apply to limited partnerships except insofar as the statutes relating to partnerships are inconsistent herewith.
7-12-26. Nature of partner's liability. -- All partners are liable, (1) except as provided in subsection (2) of this section,
(a) Jointly and severally for everything chargeable to the partnership under sections 7-12-24 and 7-12-25.
(b) Jointly for all other debts and obligations of the partnership; but any partner may enter into a separate obligation to perform a partnership contract.
(2) Subject to subsection (3) of this section, a partner in a
registered limited liability partnership {DEL shall not be
personally liable DEL} {ADD , is not liable directly or indirectly (including by
way of indemnification, contribution, assessment or otherwise) ADD}
for debts {ADD , ADD} {DEL and DEL} obligations {ADD , and liabilities ADD}
of or chargeable to the partnership whether in tort, contract
or otherwise {ADD , ADD} arising {DEL from omissions, negligence,
wrongful acts or misconduct or malpractice committed in the course
of the partnership business by another partner or an employee,
agent or representative of the partnership. DEL} {ADD while
the partnership is a registered limited liability partnership. ADD}
(3) Subsection (2) of this section does not affect the individual liability of a partner in a registered limited liability partnership for his or her own negligence, wrongful acts or misconduct or that of any person under his or her direct supervision and control {ADD other than in an administrative capacity ADD}.
(4) A partner in a registered limited liability partnership is
not a proper party in his or her individual capacity to a proceeding
by or against a registered limited liability partnership, the
object of which is to recover damages or enforce the {DEL obligations
arising out of the omissions, negligence, wrongful acts, misconduct
or malpractice of the type described in subsection (2) of this
section, DEL} {ADD obligations of the registered limited liability
partnership, ADD} unless such partner is personally liable under
subsection (3) of this section.
{ADD (5) Notwithstanding any other provisions of this section, the personal liability of a partner in a limited liability partnership engaged in the rendering of professional services shall not be less than or greater than the personal liability of a shareholder of a professional corporation organized under chapter 7-5.1 of the general laws engaged in the rendering of the same professional services.ADD}
7-12-56. Registered limited liability partnerships. -- (1) To become and to continue as a registered limited liability partnership, a partnership shall file with the secretary of state an application or a renewal application, stating the name of the partnership, the address of its principal office, if the partnership's principal office is not located in this state, the address of a registered office and the name and address of a registered agent for service of process in this state which a partnership shall be required to maintain; In addition, partnerships under this section shall provide the names and addresses of all resident partners, the place where the business records of the partnership are maintained, or if more than one location for business records is maintained, then the principal place of business of the partnership, number, a brief statement of the business in which the partnership engaged, and that the partnership thereby applies for status or renewal of its status, as a registered limited liability partnership.
(2) The application or renewal application shall be executed by a majority in interest of the partners or by one (1) or more partners authorized to execute an application or renewal application.
(3) The application or renewal application shall be accompanied by a fee of one hundred dollars ($100) for each partner, not to exceed two thousand five hundred dollars ($2,500) for each partnership's initial filing or subsequent renewal application.
(4) The Secretary of State shall register as a registered limited liability partnership, and shall renew the registration of any limited liability partnership, any partnership that submits a completed application or renewal application with the required fee.
(5) Registration shall be effective {DEL for one (1) year DEL}
{ADD until the next August 30 ADD} after the date an application
is filed, unless voluntarily withdrawn by filing with the Secretary
of State a written withdrawal notice executed by a majority in
interest of the partners or by one (1) or more partners authorized
to execute a withdrawal. Registration, whether pursuant to an
original application or a renewal application, as a registered
limited liability partnership is renewed if, during the sixty
(60) day period preceding the date of the application or renewal
application otherwise would have expired, the partnership filed
with the Secretary of State a renewal application. A renewal application
expires one (1) year after the date an original application would
have expired if the last renewal of the application had not occurred.
(6) The status of a partnership as a registered limited liability partnership shall not be affected by changes after the filing of an application or a renewal application in the information stated in the application or renewal application.
(7) The secretary of state may provide forms for application for or renewal of registration and all renewals shall be filed with the secretary of state by September 1 of each year. Any renewals shall maintain resident partners as set out in this section.
(8) A partnership that registers as a registered limited liability partnership shall not be deemed to have dissolved as a result thereof and is for all purposes the same partnership that existed before the registration and continues to be a partnership under the laws of this state. If a registered limited liability partnership dissolves, a partnership which is a successor to such registered limited liability partnership and which intends to be a registered limited liability partnership shall not be required to file a new application and shall be deemed to have filed any documents required or permitted under this chapter which were filed by the predecessor partnership.
(9) The fact that an application or renewal application is on file in the office of the secretary of state is notice that the partnership is a registered limited liability partnership and is notice of all other facts set forth in the application or renewal application.
7-12-57. Name of registered limited liability partnerships. -- The name of a registered limited liability partnership shall contain the words "registered limited liability partnership" or the abbreviation "L.L.P" {ADD or "LLP" ADD} as the last words or letters of its name.
{ADD The name shall not be the same, or deceptively similar to, the name of any domestic for profit or nonprofit corporation, or any domestic limited partnership or any domestic limited liability company or any registered limited liability partnership existing under the laws of the state or the name of any foreign for profit or nonprofit corporation, or foreign limited partnership or foreign limited liability company or foreign registered limited liability partnership authorized to transact business in this state, or a name the exclusive right to which is, at the time filed, reserved or registered in the manner provided under this title, subject to the following: ADD}
{ADD (i) this provision shall not apply if the applicant files with the secretary of state either of the following: ADD}
{ADD (A) The written consent of such other corporation, limited partnership, limited liability company, registered limited liability partnership, or holder of a filed, reserved or registered name to use the same or deceptively similar name and one (1) or more words are added to make such name distinguishable from such other name; or ADD}
{ADD (B) A certified copy of a final decree of a court of competent jurisdiction establishing the prior right of the applicant to the use of the name in this state; and ADD}
{ADD (ii) the name may be the same as, or deceptively similar to, the name of a corporation or limited liability company or registered limited liability partnership, the certificate of incorporation, authority, organization or registration of which has been revoked by the secretary of state as permitted by law and the revocation has not been withdrawn within one (1) year from the date hereof. ADD}
7-12-58. Insurance or financial responsibility of registered limited liability partnerships. -- (1) A registered limited liability partnership {ADD that is to perform professional services as defined in section 7-5.1-2 of the general laws ADD} shall carry, if reasonably available, liability insurance of a kind that is designed to cover the kinds of negligence, wrongful acts or misconduct for which liability is limited by section 7-12-26(2). The insurance shall be in the aggregate amount of fifty thousand dollars ($50,000) multiplied by the number of professional employees of the registered limited liability partnership as of the policy anniversary date; provided, however, that in no case shall the coverage be less than one hundred thousand dollars ($100,000) but in no event shall the necessary coverage exceed a maximum of five hundred thousand dollars ($500,000); provided further, however, that any policy for insurance coverage may include a deductible provision in any amount not to exceed twenty-five thousand dollars ($25,000) for each claim multiplied by the number of professional employees of the limited liability partnership as of the date of the issuance of the policy. Such policy or policies of insurance may be subject to such terms, conditions, exclusions and endorsements as are typically contained in policies of this type.
(2) If, in any proceeding, compliance by a partnership with the requirements of subsection (1) of this section is disputed:
(a) That issue shall be determined by the court, and
(b) The burden of proof of compliance shall be on the person who claims the limitation of liability in section 7-12-26(2).
(3) If a registered limited liability partnership is in compliance with the requirements of subsection (1) of this section, the requirements of this section shall not be admissible or in any way be made known to a jury in determining an issue of liability for or extent of the debt or obligation or damages in question.
(4) Insurance is reasonably available for the purpose of subsection (1) of this section if, at such time as the coverage would apply to the negligence, wrongful acts or misconduct in question it was reasonably available to similar types of partnerships through the admitted or eligible surplus lines market.
(5) A registered limited liability partnership is considered to be in compliance with subsection (1) of this section if the partnership provides five hundred thousand dollars ($500,000) of funds specifically designated and segregated for the satisfaction of judgments against the partnership based on the forms of negligence, wrongful acts and misconduct for which liability is limited by section 7-12-26(2) by:
(a) Deposit in trust or in bank escrow of cash, bank certificates of deposit or United States Treasury obligations; or
(b) A bank letter or credit or insurance company bonds.
(6) To the extent that a partnership maintains liability insurance or segregated funds pursuant to the laws or regulations of another jurisdiction, such liability insurance or segregated funds shall be deemed to satisfy this section if the amount hereof is equal to or greater than the amount specified in subsection (1) or subsection (5).
7-12-59. Applicability to foreign and interstate commerce. -- (1) A partnership, including a registered limited liability partnership, formed and existing pursuant to an agreement governed by this chapter may conduct its business, carry on its operations and have and exercise the powers granted by this chapter in any state, territory, district or possession of the United States or in any foreign country.
(2) It is the intent of the general assembly that the legal existence of partnerships, including registered limited liability partnerships, formed in this state be recognized outside the boundaries of this state and that, subject to any reasonable requirement of registration, a partnership, including a registered limited liability partnership, formed pursuant to an agreement governed by this chapter and transacting business outside this state be granted the protection of full faith and credit under the Constitution of the United States.
(3) The liability of partners in a partnership, including registered limited liability partnerships, formed and existing pursuant of an agreement governed by this chapter for the debts and obligations of the partnership shall at all times be determined solely and exclusively by the laws of this state.
(4) Before transacting business in this state, a foreign registered limited liability partnership shall comply with any statutory or administrative registration or filing requirements governing the specific type of business in which the partnership is engaged, and file a notice with the secretary of state, on such forms as the secretary shall provide, stating:
(a) The name of the partnership,
(b) The jurisdiction, {ADD the laws of which govern its partnership agreement and under which it is registered as a limited liability partnership, ADD}
(c) {DEL The laws of which govern its partnership agreement
and under which it is registered as a limited liability partnership, DEL}
(d) The address of its principal office,
(e) If the partnership's principal office is not located in this state,
(f) The address of a registered office and the name and address of a registered agent for service of process in this state which the partnership shall be required to maintain,
(g) The names and addresses of all resident partners in this state,
(h) A brief statement of the business in which the partnership engages,
(i) Any other information that the partnership determines to include,
(j) A statement that the partnership is registered limited liability partnership. Such notice shall be accompanied by a fee of one thousand dollars ($1,000). Such notice shall be effective for two (2) years from the date of filing, provided they are in compliance with section 7-12-56, after which time the partnership shall file a new notice. The filing of such notice with the secretary of state shall make it unnecessary to file any other documents under sections 6-1-1 to 6-1-4.
(5) The name of a foreign registered limited liability partnership doing business in this state shall contain the words "Registered Limited Liability Partnership" or "L.L.P." or "LLP", or such other similar words or abbreviation as may be required or authorized by the laws of the state where the partnership is registered, as the last words or letters of its name.
(6) The internal affairs of foreign registered limited liability partnerships, including the liability of partners for debts, obligations and liabilities of or chargeable to the partnership or another partner or partners, shall be subject to and governed by the laws of the jurisdiction in which the foreign registered limited liability partnership is registered.
SECTION 2. This act shall take effect upon passage.
