| | | An unincorporated nonprofit organization is not a partnership | | under RUPA, even if it qualifies as a business, because it is not | | a "for profit" organization. |
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| | | 3. Subsection (c) provides three rules of construction that | | apply in determining whether a partnership has been formed under | | subsection (a). They are largely derived from UPA Section 7, and | | to that extent no substantive change is intended. The sharing of | | profits is recast as a rebuttable presumption of a partnership, a | | more contemporary construction, rather than as prima facie | | evidence thereof. The protected categories, in which receipt of | | a share of the profits is not presumed to create a partnership, | | apply whether the profit share is a single flat percentage or a | | ratio which varies, for example, after reaching a dollar floor or | | different levels of profits. |
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| | | Like its predecessor, RUPA makes no attempt to answer in every | | case whether a partnership is formed. Whether a relationship is | | more properly characterized as that of borrower and lender, | | employer and employee, or landlord and tenant is left to the | | trier of fact. As under the UPA, a person may function in both | | partner and nonpartner capacities. |
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| | | Paragraph (3)(v) adds a new protected category to the list. | | It shields from the presumption a share of the profits received | | in payment of interest or other charges on a loan, "including a | | direct or indirect present or future ownership in the collateral, | | or rights to income, proceeds, or increase in value derived from | | the collateral." The quoted language is taken from Section 211 | | of the Uniform Land Security Interest Act. The purpose of the | | new language is to protect shared-appreciation mortgages, | | contingent or other variable or performance-related mortgages, | | and other equity participation arrangements by clarifying that | | contingent payments do not presumptively convert lending | | arrangements into partnerships. |
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| | | 4. Section 202(e) of the 1993 Act stated that partnerships | | formed under RUPA are general partnerships and that the partners | | are general partners. That section has been deleted as | | unnecessary. Limited partners are not "partners" within the | | meaning of RUPA, however. |
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| | | §1023.__Partnership property |
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| | | Property acquired by a partnership is property of the | | partnership and not of the partners individually. |
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| | | (This is Section 203 of the Uniform Partnership Act (1997).) |
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