Chapter 4 - § 4.20 • GENERAL PARTNERSHIPS

• Jurisdiction: Colorado

§ 4.20 • GENERAL PARTNERSHIPS

The current law governing general partnerships in Colorado is the Colorado Uniform Partnership Act (CUPA),³²⁴ which became effective January 1, 1998.³²⁵ This Act governs only partnerships formed after January 1, 1998 (unless that partnership is continuing the business of a partnership that had dissolved under C.R.S. § 7-60-141, "Liability of persons continuing business") and partnerships formed before January 1, 1998 that elect to be governed by the Colorado Uniform Partnership Act.³²⁶ (Apparently, a partnership formed on January 1, 1998 is not governed by the Uniform Partnership Act and cannot elect to be so governed.) Partnerships not governed by CUPA are governed by the Uniform Partnership Law of 1931 (UPL).³²⁷

§ 4.20.1—Power to Acquire and Hold Real Property

Prior to the enactment of the Uniform Partnership Law in 1931, a partnership could not hold title to real property in the partnership name.³²⁸ Since 1931, however, a partnership may acquire and hold property in the partnership name both under the Uniform Partnership Law of 1931³²⁹ and the Colorado Uniform Partnership Act of 1997.³³⁰

§ 4.20.2—Partnership Property

UPL. Under the Uniform Partnership Law of1931, all property originally brought into the partnership stock or subsequently acquired by purchase or otherwise on account of the partnership is partnership property.³³¹ Unless a contrary intention appears, property acquired with partnership funds is partnership property.³³² Any estate in real property may be acquired in the partnership name.³³³

CUPA. Under the Colorado Uniform Partnership Act, property is partnership property if it is acquired in the name of the partnership, or of one or more partners with an indication in the instrument transferring title to the property of the person's capacity as a partner or of the existence of the partnership but without an indication of the name of the partnership.³³⁴ Property is acquired in the name of the partnership by a transfer to the partnership in its name, or one or more partners in their capacity as partners in the partnership, if the name of the partnership is indicated in the instrument transferring title to the property.³³⁵ Property is presumed to be partnership property if purchased with partnership assets, even if not acquired in the name of the partnership or of one or more partners with an indication in the instrument transferring title to the property of the person's capacity as a partner or of the existence of the partnership.³³⁶ Property acquired in the name of one or more of the partners, without an indication in the instrument transferring title to the property of the person's capacity as a partner or the existence of the partnership and without use of partnership assets is presumed to be separate property, even if used for a partnership purpose.³³⁷ A written conveyance from a partner who originally brings real estate into the partnership, although a factor, is not required to convert real property into partnership property.³³⁸

§ 4.20.3—Partner's Property Rights

Prior to the enactment of the Uniform Partnership Law of 1931, a grant to a partnership would vest no rights in a partner individually.³³⁹

UPL. Under the Uniform Partnership Law, the property rights of a partner are (1) his or her interest in specific partnership property, (2) his or her interest in the partnership, and (3) his or her right to participate in the management.³⁴⁰ A partner is co-owner with his or her partners of specific partnership property as a tenant in partnership.³⁴¹ The incidents of a tenancy in partnership are that:

• A partner, subject to the provisions of the Uniform Partnership Law and to any agreement between the partners, has an equal right with his or her partners to possess specific partnership property for partnership purposes, but has no right to possess such property for any other purpose without the consent of his or her partners.³⁴²
• A partner's right in specific partnership property is not assignable except in connection with the assignment of rights of all partners in the same property.³⁴³
• A partner's right in specific partnership property is not subject to attachment or execution except on a claim against the partnership. When partnership property is attached for a partnership debt, the partners, or any of them, or the representative of a deceased partner, cannot claim any right under the homestead or exemption laws.³⁴⁴
• On the death of a partner, his or her right in specific partnership property vests in the surviving partner or partners, except where the deceased was the last surviving partner, in which case the deceased partner's right to such property vests in his or her legal representative. The surviving partner or partners, or the legal representatives of the last surviving partner, have no right to possess the partnership property for any but a partnership purpose.³⁴⁵
• A partner's right in specific property is not subject to dower, curtesy, or allowances to widows, heirs, or next of kin.³⁴⁶

CUPA. Under the Colorado Uniform Partnership Act, a partner is not a co-owner of partnership property and has no interest in partnership property, which can be transferred either voluntarily or involuntarily.³⁴⁷ A partner may use or possess partnership property only on behalf of the partnership.³⁴⁸ But if a person holds all of the partners' interests in the partnership, all of the partnership property vests in him or her, and he or she may execute a document in the name of the partnership to evidence vesting of the property in him or her and may file or record the document.³⁴⁹

§ 4.20.4—Conveyances of Partnership Real Property

Title in Partnership Name, Conveyance in Partnership Name

UPL. Under the Uniform Partnership Law of 1931, any real...