| | | 1. Section 105 is new. It mandates the procedural rules for | | the execution, filing, and recording of the various "statements" | | (see Section 101(11)) authorized by RUPA. Section 101(13) makes | | clear that a statement of qualification filed by a partnership to | | become a limited liability partnership is included in the | | definition of a statement. Therefore, the execution, filing, and | | recording rules of this section must be followed except that the | | decision to file the statement of qualification must be approved | | by the vote of the partners necessary to amend the partnership | | agreement as to contribution requirements. See Section 1001(b) | | and Comments. |
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| | | No filings are mandatory under RUPA. In all cases, the filing | | of a statement is optional and voluntary. A system of mandatory | | filing and disclosure for partnerships, similar to that required | | for corporations and limited partnerships, was rejected for | | several reasons. First, RUPA is designed to accommodate the | | needs of small partnerships, which often have unwritten or | | sketchy agreements and limited resources. Furthermore, | | inadvertent partnerships are also governed by the Act, as the | | default form of business organization, in which case filing would | | be unlikely. |
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| | | The RUPA filing provisions are, however, likely to encourage | | the voluntary use of partnership statements. There are a number | | of strong incentives for the partnership or the partners to file | | statements or for third parties, such as lenders or transferees | | of partnership property, to compel them to do so. |
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| | | Only statements that are executed, filed, and, if appropriate | | (such as the authority to transfer real property), recorded in | | conformity with Section 105 have the legal consequences accorded | | statements by RUPA. The requirements of Section 105 cannot be | | varied in the partnership agreement, except the duty to provide | | copies of statements to all the partners. See Section 103(b)(1). |
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| | | In most States today, the filing and recording of statements | | requires written documents. As technology advances, alternatives | | suitable for filing and recording may be developed. RUPA itself | | does not impose any requirement that statements be in writing. | | It is intended that the form or medium for filing and recording | | be left to the general law of adopting States. |
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| | | 2. Section 105(a) provides for a single, central filing of | | all statements, as is the case with corporations, limited | | partnerships, and limited liability companies. The expectation | | is that most States will assign to the Secretary of State the | | responsibility of maintaining the filing system for partnership | | statements. Since a partnership is an entity under RUPA, all |
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