1E9Ct5D

Each province has its own Partnership Act,but with few exceptions the provisions ofthose acts are subject to any agreementmade between the partners. All the Atlanticprovinces other than Newfoundland andLabrador require partnerships to register thename under which they will be carrying onbusiness and to maintain an annualregistration. They also require that acomputerized name search be conductedprior to registering the name of apartnership.Partners should have a written partnershipagreement. If the partners do not enter intoa written partnership agreement, thecommon law implicitly provides one forthem, and it is unlikely that this unwrittenagreement will be on the same terms andconditions as the partners would haveagreed to if a written partnership agreementhad been entered into. A written partnershipagreement outlines the rights, interests andresponsibilities of each partner and sets outthe proportionate right to earnings or losses,whether or not a partner can be expelledfrom the partnership, and how thepartnership can be terminated.The primary disadvantage of a partnershipis that each partner is held liable for all ofthe debts and liabilities of the partnershipthat are incurred while that person was apartner, including liability for wrongful actsor omissions of any partner in thepartnership while that partner was carryingon business in the ordinary course.Limited PartnershipA limited partnership is very similar to that ofa general partnership described above, withthe major distinction being that in a limitedpartnership certain partners (the generalpartners) contribute management efforts tothe partnership while other partners (thelimited partners) contribute only capital,which contribution can be either cash orother property, but not services.Limited partnerships are governed byspecific provincial legislation knownvariously as the Limited Partnerships Act orthe Limited Partnership Act; however, theprovincial Partnership Act statutes and thecommon law also apply to limitedpartnerships to the extent that they are notinconsistent with the specific limitedpartnerships legislation. As in the case withgeneral partnerships, a computerized namesearch is required prior to registering thename of a limited partnership in NovaScotia, New Brunswick and Prince EdwardIsland.A limited partnership must have a minimumof one general partner and one limitedpartner, and each limited partner is liable forthe obligations of the limited partnershiponly to the extent of its capital contribution.This protection can, however, be lost if thelimited partner takes part in the control ofthe business, which can occur if the limitedpartner participates in the management ofthe business of the limited partnership.A limited partnership is formed when eithera certificate or declaration (depending onthe province) is filed with the applicableprovincial authority and recorded. Thisdocument contains the essential terms ofthe limited partnership, including the nameof the partnership, the nature of itsbusiness, the names of all partners and,with the exception of New Brunswick, theamount of capital contributed by the limitedForms of Business Organizations 19