Pennsylvania § 8620 - Characteristics of limited partnership.

§ 8620. Characteristics of limited partnership.

(a) Separate entity.--A limited partnership is an entity distinct from its partners. A limited partnership is the same entity regardless of whether:

(1) its certificate of limited partnership states that the limited partnership is a limited liability limited partnership; or

(2) it has a statement of registration in effect under section 8201 (relating to scope).

(b) Purpose.--A limited partnership may have any lawful purpose, other than acting as a banking institution, credit union or insurer, regardless of whether the purpose is for profit. See section 8102 (relating to interchangeability of partnership, limited liability company and corporate forms of organization).

(c) Duration.--A limited partnership has perpetual duration.

(d) Powers.--A limited partnership has the capacity to sue and be sued in its own name and the power to do all things necessary or convenient to carry on its activities and affairs.

(e) Restrictions on nonprofit limited partnerships.--If a limited partnership has a purpose that is not for profit:

(1) Its purpose must be stated in the certificate of limited partnership.

(2) The partnership shall not distribute any part of its income or profits to its partners, but it may pay compensation in a reasonable amount to those persons for services rendered.

(3) The partnership may confer benefits on partners or nonpartners in conformity with its purposes, may repay capital contributions and may redeem evidences of indebtedness, except when the partnership is currently insolvent or would thereby be made insolvent or rendered unable to carry on its purposes, or when the fair value of the assets of the partnership remaining after the conferring of benefits, payment or redemption would be insufficient to meet its liabilities. The partnership may make distributions of money or property to partners upon dissolution or final liquidation as permitted by this chapter.

(4) If the partnership is organized for a charitable purpose, it may take, receive and hold real and personal property as may be given, devised to, or otherwise vested in the partnership, in trust, for the purpose or purposes set forth in its certificate of limited partnership. The general partners shall, as trustees of the property, be held to the same degree of responsibility and accountability as other trustees, unless:

(i) a lesser degree or a particular degree of responsibility and accountability is prescribed in the trust instrument; or

(ii) the general partners are under the control of the limited partners or third persons who retain the right to direct, and do direct, the actions of the general partners as to the use of the trust property from time to time.

(5) Property of the partnership committed to charitable purposes shall not, by any proceeding under Chapter 3 (relating to entity transactions) or otherwise, be diverted from the objects to which it was donated, granted or devised, unless and until the partnership obtains from the court an order under 20 Pa.C.S. Ch. 77 (relating to trusts) specifying the disposition of the property.

(f) Cross references.--See sections 8611(d) (relating to short title and application of chapter) and 8615 (relating to contents of partnership agreement).

Cross References. Section 8620 is referred to in sections 8102, 8611, 8615, 8621 of this title.