Pennsylvania Partnership Agreement

Pennsylvania partnership agreements are beneficial to any partnership because they are binding contracts that fully spell out how the partnership operates and each partner’s status. This is especially important for limited partnerships where the partners’ contributions and liabilities typically differ significantly.

Last updated January 29th, 2025

Pennsylvania partnership agreements are beneficial to any partnership because they are binding contracts that fully spell out how the partnership operates and each partner’s status. This is especially important for limited partnerships where the partners’ contributions and liabilities typically differ significantly.

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Pennsylvania Partnership Types (4)

Partnership Type State Filing Requirement
General Partnership (GP) Pennsylvania does not require general partnerships to file a Certificate of Authority; however, all partnerships in this state must abide by its naming requirements Business Entity Search
File Certificate of Partnership Authority online with Pennsylvania One Stop (Filing Fee: $70.00)
Limited Partnership (LP) File Certificate of Limited Partnership online with Pennsylvania One Stop (Filing Fee: $125.00)
Limited Liability Partnership (LLP) File Certificate of Limited Liability Partnership online with Pennsylvania One Stop (Filing Fee: $125.00)
Limited Liability Limited Partnership (LLLP) File Certificate of Limited Partnership online with Pennsylvania One Stop  (Filing Fee: $125.00). Must meet the statement of qualification requirements.

 

Fiduciary Duty

Duty of Loyalty:
  • The partner’s duty to the partnership includes accounting (“as a trustee”) a complete account of the property, profits, and benefits resulting from the partnership’s existence, property, opportunities and business dealings.[1]
  • Partners keep the interest of the partnership in mind, so they do not do business “as or on behalf of a person” with a deliberate intention or interest that circumvents the partnership.[2]
  • Partners do not participate in ventures “competing with the partnership,” whether during its business conduct or dissolution. [3]

Duty of Care:

  • A partner must conduct themselves lawfully as well as avoid any conduct that is reckless, negligent, or constituting willful “misconduct. [4]

Partners in any partnership adhere to their partnership agreement as well as the law by maintaining a “good faith and fair dealing” policy whenever conducting partnership business. [5]

Partners do not engage in “self-serving conduct” if such conduct is a violation of their partnership agreement and duties. [6][7]

Liability

All partners are liable for their partnership’s “debts, obligations, and other liabilities” accordingly but exceptions can be found through applicable laws or a claimant’s agreement. [8]
Partners do not automatically assume or carry the “preexisting obligations” that a partnership already carries before the date of their admittance to that partnership. [9]
Generally, partners in a limited liability partnership as well as a limited liability limited partnership enjoy the protection from the entity’s liabilities afforded by Pennsylvania law so long as the entity’s registration is valid and active. [10]
All partnerships are liable for their actions, especially for “loss or injury caused to a person,” even if such liability results from any partner’s wrongful actions with partnership authority or as part of a normal business day. [11]
Partnerships take on the liability resulting from a partner’s “misapplication of property,” money, or other such benefit that one partner receives from a third party during the course of business and while using partnership authority in any way. [12]

State Definitions (5)

Partner means that a person co-owns a for-profit business either as a “limited partner or general partner” and upholds the responsibilities that role holds as per the partnership agreement in effect. [13]
General partner is a person formally acting as a general partner under Pennsylvania law; additionally, they are considered especially liable for a limited partnership. [14]
Limited partner is the partner in a limited partnership who carries this title in the partnership agreement and is a current partner in the LP. [15]
Partnership is “an association of two or more persons” who co-own a for-profit business while remaining faithful to Pennsylvania law accordingly; additionally, this definition applies to limited liability partnerships.[16]

Limited partnership means that a partnership owned by one limited partner (or more) and at least one general partner has formed in accordance with Pennsylvania’s partnership laws; in addition, limited liability limited partnerships fall within this definition. [17]