Relations of Partners to Each Other and to Partnership.

D.C. Code div. V, tit. 29, ch. 6, subch. IV

in effect

D.C. Code § 29-604.01 Partner’s rights and duties.

29-604.01. Partner’s rights and duties. (a) Each partner shall deemed to have an account that is: (1) Credited with an amount equal to the money plus the value of any other property, net of the amount of any liabilities, the partner contributes to the partnership and the partner’s share of the partnership profits; and (2) Charged with an amount equal to the money plus the value of any other property, net of the amount of any liabilities, distributed by the partnership to the partner and the partner’s share of the partnership losses. (b) Each partner shall be entitled to an equal share of the partnership profits and shall be chargeable with a share of the partnership losses in proportion to the partner’s share of the profits. (c) A partnership shall reimburse a partner for payments made, and indemnify a partner for liabilities incurred, by the partner in the ordinary course of the business of the partnership or for the preservation of its business or property. (d) A partnership shall reimburse a partner for an advance to the partnership beyond the amount of capital the partner agreed to contribute. (e) A payment or advance made by a partner which gives rise to a partnership obligation under subsection (c) or (d) of this section shall constitute a loan to the partnership which accrues interest from the date of the payment or advance. (f) A partnership shall indemnify and hold harmless a person with respect to any claim or demand against the person and any debt, obligation, or other liability incurred by the person by reason of the person’s former or present capacity as partner, if the claim, demand, debt, obligation, or other liability does not arise from the person’s breach of this section, § 29-604.07, or § 29-610.02. (g) In the ordinary course of its business, a partnership may advance reasonable expenses, including attorney’s fees and costs, incurred by a person in connection with a claim or demand against the person by reason of the person’s former or present capacity as a partner, if the person promises to repay the partnership if the person ultimately is determined not to be entitled to be indemnified under subsection (f) of this section. (h) A partnership may purchase or maintain insurance against liability arising from a partner’s status and asserted against or incurred by a partner acting in his or her capacity. Such insurance may be purchased and maintained even if, under § 29-601.04(b)(13), the partnership agreement does not permit limitation or elimination of partner liability. (i) Each partner shall have equal rights in the management and conduct of the partnership business. (j) A partner shall use or possess partnership property only on behalf of the partnership. (k) A partner shall not be entitled to remuneration for services performed for the partnership, except for reasonable compensation for services rendered in winding up the business of the partnership. (l) A difference arising as to a matter in the ordinary course of business of a partnership shall be decided by a majority of the partners. An act outside the ordinary course of business of a partnership and an amendment to the partnership agreement shall be undertaken only with the consent of all of the partners. (m) This section shall not affect the debts, liabilities, or other obligations of a partnership to other persons under § 29-603.01. (July 2, 2011, D.C. Law 18-378, § 2, 58 DCR 1720; Mar. 5, 2013, D.C. Law 19-210, § 2(f)(4)(A), 59 DCR 13171.)

D.C. Code § 29-604.02 Becoming partner.

29-604.02. Becoming partner. (a) Upon formation of a partnership under § 29-602.02(a), a person becomes a partner. (b) After formation of a partnership, a person becomes a partner: (1) As provided in the partnership agreement; (2) As a result of a transaction effective under Subchapter [subchapter] IX of this chapter or Chapter 2 of this title; or (3) With the consent of all the partners. (c) A person may become a partner without: (1) Acquiring a transferable interest; or (2) Making or being obligated to make a contribution to the partnership. (July 2, 2011, D.C. Law 18-378, § 2, 58 DCR 1720; Mar. 5, 2013, D.C. Law 19-210, § 2(f)(4)(B), (D), 59 DCR 13171.)

D.C. Code § 29-604.03 Form of contribution.

29-604.03. Form of contribution. A contribution may consist of property transferred, services performed, or other benefit provided to the partnership or an agreement to transfer property, perform services, or provide another benefit. (Mar. 5, 2013, D.C. Law 19-210, § 2(f)(4)(D), 59 DCR 13171.)

D.C. Code § 29-604.04 Liability for contributions.

29-604.04. Liability for contributions. (a) A person’s obligation to make a contribution to a partnership is not excused by the person’s death, disability, or other inability to perform personally. (b) If a person does not fulfill an obligation to make a contribution other than money, the person is obligated at the option of the partnership to contribute money equal to the value of the part of the contribution which has not been made. (c) The obligation of a person to make a contribution may be compromised only by consent of all partners. If a creditor of a limited liability partnership extends credit or otherwise acts in reliance on an obligation described in subsection (a) of this section, without notice of a compromise under this subsection, the creditor may enforce the obligation. (Mar. 5, 2013, D.C. Law 19-210, § 2(f)(4)(D), 59 DCR 13171.)

D.C. Code § 29-604.05 Distributions in kind; sharing of and right to distribution before dissolution.

29-604.05. Distributions in kind; sharing of and right to distribution before dissolution. (a) Any distributions made by a partnership before its dissolution and winding up must be in equal shares among partners, except to the extent necessary to comply with a transfer effective under § 29-605.03 or charging order in effect under § 29-605.04. (b) A person has a right to a distribution before the dissolution and winding up of a partnership only if the partnership decides to make an interim distribution. (c) A person does not have a right to demand or receive a distribution from a partnership in any form other than money. Except as otherwise provided in § 29-608.09, a partnership may distribute an asset in kind only if each part of the asset is fungible with each other part and each person receives a percentage of the asset equal in value to the person’s share of distributions. (d) If a partner or transferee becomes entitled to receive a distribution, the partner or transferee has the status of, and is entitled to all remedies available to, a creditor of the partnership with respect to the distribution. However, the partnership’s obligation to make a distribution is subject to offset for any amount owed to the partnership by the partner or a person dissociated as partner on whose account the distribution is made. (Mar. 5, 2013, D.C. Law 19-210, § 2(f)(4)(D), 59 DCR 13171.)

D.C. Code § 29-604.06 Partner’s rights and duties with respect to information.

29-604.06. Partner’s rights and duties with respect to information. (a) A partnership shall keep its books and records, if any, at its principal office. (b) A partnership shall provide partners and their agents and attorneys access to its books and records. It shall provide former partners and their agents and attorneys access to books and records pertaining to the period during which they were partners. The right of access provides the opportunity to inspect and copy books and records during ordinary business hours. A partnership may impose a reasonable charge, covering the costs of labor and material, for copies of documents furnished. (c) Each partner and the partnership shall furnish to a partner, and to the legal representative of a deceased partner or partner under legal disability: (1) Without demand, any information concerning the partnership’s business [activities] and affairs reasonably required for the proper exercise of the partner’s rights and duties under the partnership agreement or this chapter; and (2) On demand, any other information concerning the partnership’s business [activities] and affairs, except to the extent the demand or the information demanded is unreasonable or otherwise improper under the circumstances. (July 2, 2011, D.C. Law 18-378, § 2, 58 DCR 1720; Mar. 5, 2013, D.C. Law 19-210, §§ 2(f)(4)(C), (D), 59 DCR 13171.)

D.C. Code § 29-604.07 General standards of partner’s conduct.

29-604.07. General standards of partner’s conduct. (a) The only fiduciary duties a partner owes to the partnership and the other partners are the duty of loyalty and the duty of care set forth in subsections (b) and (c) of this section. (b) A partner’s duty of loyalty to the partnership and the other partners include the following: (1) To account to the partnership and hold as trustee for it any property, profit, or benefit derived by the partner in the conduct and winding up of the partnership business or derived from a use by the partner of partnership property, including the appropriation of a partnership opportunity; (2) To refrain from dealing with the partnership in the conduct or winding up of the partnership business as or on behalf of a party having an interest adverse to the partnership; and (3) To refrain from competing with the partnership in the conduct of the partnership business before the dissolution of the partnership. (c) A partner’s duty of care to the partnership and the other partners in the conduct and winding up of the partnership business shall be limited to refraining from engaging in grossly negligent or reckless conduct, intentional misconduct, or a knowing violation of law. (d) A partner shall discharge the duties to the partnership and the other partners under this chapter or under the partnership agreement and exercise any rights consistently with the obligation of good faith and fair dealing. (e) A partner does not violate a duty or obligation under this chapter or under the partnership agreement merely because the partner’s conduct furthers the partner’s own interest. (f) A partner may lend money to and do other business with the partnership, and, as to each loan or transaction, the rights and obligations of the partner shall be the same as those of a person that is not a partner, subject to other applicable law. (g) This section shall apply to a person winding up the partnership business as the personal or legal representative of the last surviving partner as if the person were a partner. (h) All the partners may authorize or ratify, after full disclosure of all material facts, a specific act or transaction that otherwise would violate the duty of loyalty. (i) It is a defense to a claim under subsection (b)(2) of this section and any comparable claim in equity or at common law that the transaction was fair to the partnership. (j) If, as permitted by subsection (f) of this section or the partnership agreement, a partner enters into a transaction with the partnership which otherwise would be prohibited by subsection (b)(2) of this section, the partner’s rights and obligations arising from the transaction are the same as those of a person that is not a partner. (July 2, 2011, D.C. Law 18-378, § 2, 58 DCR 1720; Mar. 5, 2013, D.C. Law 19-210, §§ 2(f)(4)(C), (E), 59 DCR 13171.)

D.C. Code § 29-604.08 Actions by partnership and partners.

29-604.08. Actions by partnership and partners. (a) A partnership may maintain an action against a partner for a breach of the partnership agreement, or for the violation of a duty to the partnership, causing harm to the partnership. (b) A partner may maintain an action against the partnership or another partner for legal or equitable relief, with or without an accounting as to partnership business, to enforce the: (1) Partner’s rights under the partnership agreement; (2) Partner’s rights under this chapter, including: (A) The partner’s rights under § 29-604.01, § 29-604.03, or § 29-604.04; (B) The partner’s right on dissociation to have the partner’s interest in the partnership purchased pursuant to § 29-607.01 or enforce any other right under subchapter VI or VII of this chapter; or (C) The partner’s right to compel a dissolution and winding up of the partnership business under § 29-608.01 or enforce any other right under subchapter VIII of this chapter; or (3) Rights and otherwise protect the interests of the partner, including rights and interests arising independently of the partnership relationship. (c) The accrual of, and any time limitation on, a right of action for a remedy under this section shall be governed by other law. A right to an accounting upon a dissolution and winding up shall not revive a claim barred by law. (July 2, 2011, D.C. Law 18-378, § 2, 58 DCR 1720; Mar. 5, 2013, D.C. Law 19-210, § 2(f)(4)(C), 59 DCR 13171.)

D.C. Code § 29-604.09 Continuation of partnership beyond definite term or particular undertaking.

29-604.09. Continuation of partnership beyond definite term or particular undertaking. (a) If a partnership for a definite term or particular undertaking is continued, without an express agreement, after the expiration of the term or completion of the undertaking, the rights and duties of the partners shall remain the same as they were at the expiration or completion, so far as is consistent with a partnership at will. (b) If the partners, or those of them who habitually acted in the business during the term or undertaking, continue the business without any settlement or liquidation of the partnership, they shall be presumed to have agreed that the partnership will continue. (July 2, 2011, D.C. Law 18-378, § 2, 58 DCR 1720; Mar. 5, 2013, D.C. Law 19-210, § 2(f)(4)(C), 59 DCR 13171.)

Source: Council of the District of Columbia (code.dccouncil.gov)URL: https://code.dccouncil.gov/us/dc/council/code/titles/29/chapters/6/subchapters/IVFetched: 10/21/2026