2014 Pennsylvania Consolidated Statutes
Title 15 - CORPORATIONS AND UNINCORPORATED ASSOCIATIONS
Chapter 85 - Limited Partnerships
Section 8524 - Person erroneously believing himself limited partner

§ 8524. Person erroneously believing himself limited partner.

(a) General rule.--Except as provided in subsection (b), a person who makes a contribution to a business enterprise and erroneously but in good faith believes that he has become a limited partner in the enterprise is not a general partner in the enterprise and is not bound by its obligations as a general partner by reason of making the contribution, receiving distributions from the enterprise or exercising any rights of a limited partner if, within a reasonable time after ascertaining the mistake, he:

(1) causes an appropriate certificate of limited partnership or a certificate of amendment to be executed and filed; or

(2) withdraws from future equity participation in the enterprise by executing and filing in the Department of State a certificate of withdrawal which shall set forth:

(i) The name of the limited partnership.

(ii) The date of filing of the original certificate.

(iii) The name of the person withdrawing.

The certificate of withdrawal shall be effective upon filing in the department. The person withdrawing shall send a copy of the filed certificate of withdrawal to the limited partnership.

(b) Third-party liability.--A person who makes a contribution of the kind described in subsection (a) is liable as a general partner to any third party who transacts business with the enterprise:

(1) before the person withdraws and an appropriate certificate is filed to show withdrawal; or

(2) before an appropriate certificate or amendment is filed to show that he is not a general partner;

but only if the third party actually believed in good faith that the person was a general partner at the time of the transaction, acted in reasonable reliance on that belief and extended credit to the enterprise in reasonable reliance on the credit of the person and, if a certificate of limited partnership has been filed prior to the transaction, the limited partner is erroneously named as a general partner in the certificate or in a certificate of amendment.

(c) Cross references.--See sections 134 (relating to docketing statement) and 8514 (relating to execution of certificates).

Cross References. Section 8524 is referred to in section 8532 of this title.