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For Purposes of Owning Real Estate

15 January, 2016 - 09:35

Aggregate theory concepts bedeviled property co-ownership issues, so UPA finessed the issue by stating that partnership property, real or personal, could be held in the name of the partners as “tenants in partnership”—a type of co-ownership—or it could be held in the name of the partnership. 1 Under RUPA, “property acquired by the partnership is property of the partnership and not of the partners.” 2 But RUPA is no different from UPA in practical effect. The latter provides that “property originally brought into the partnership stock or subsequently acquired by purchase…on account of the partnership, is partnership property.” 3 Under either law, a partner may bring onto the partnership premises her own property, not acquired in the name of the partnership or with its credit, and it remains her separate property. Under neither law can a partner unilaterally dispose of partnership property, however labeled, for the obvious reason that one cannot dispose of another’s property or property rights without permission. 4 And keep in mind that partnership law is the default: partners are free to make up partnership agreements as they like, subject to some limitations. They are free to set up property ownership rules as they like.