According to Becker, a limited partner who participates in control of the business is liable to any creditor who reasonably believes he is a general partner. As such, I think the example below should have full personal liability. The answer says otherwise, so any help would be appreciated!
Q) Juan is a limited partner at A-corp, LP. Juan visited Cow Inc., a local supplier of food claiming to be a partner in the partnership and negotiated a distribution contract between the supplier and LP on behalf of the partnership. As a result of these actions, Juan:
A) Has limited liability as a limited partner to all creditors except Chow, Inc.
Me- How is that possible? Didn't Juan act as a general partner, and so he should be personally liable? Other possible answers were...
- "has limited liability as a limited partner in reference to all creditors"
- "has full personal liability to all creditors"
- "none of the above."
Thank you for helping me understand!
A - (5/2012)
R - (1/2012) Done!
F - (10/2011) Done!
