CONVEYANCES INVOLVING GENERAL PARTNERSHIPS


11.1 General; Authority; Execution


The Uniform Partnership Act (“UPA”) as adopted in this state went into effect on April 1, 1985. UPA Section 10 (O.C.G.A. Section 14-8-10) contains specific rules regarding the manner in which real property of a general partnership may be conveyed, depending in part on whether it is titled in the name of the partnership or in the names of the partners. UPA Section 9 (O.C.G.A. Section 14-8-9) deals with the authority of general partners to act on behalf of the partnership and, in general, establishes that each partner is an agent of the partnership and that the act of every partner, including the execution in the partnership name of any instrument for apparently carrying on in the usual way the business of the partnership, binds the partnership. The examiner should note, however, that less than all of the partners do not have authority to “do any other act which would make it impossible to carry on the ordinary business of a partnership.” (O.C.G.A. Section 14-8-9(3)(C)). Accordingly, if the examiner is unable to establish to the examiner’s satisfaction, by affidavit or otherwise, that the conveyance of the real property at issue would not have such effect, the examiner may reasonably require execution by all of the partners. The examiner also should be aware that UPA Section 4 (O.C.G.A. Section 14-8-4) provides that “the validity of an instrument executed on behalf of the partnership by a partner shall not be affected by the formality with which the partnership contract was executed.” A limited liability partnership (“LLP”) is a general partnership that has registered either with the Secretary of State or county superior court clerk. In 1994, Georgia allowed foreign LLP’s to register to transact business in Georgia, and in 1995 allowed domestic LLP’s to form. Foreign LLP’s must register with the Secretary of State (O.C.G.A. Section 14-8-45). Domestic LLP’s must record with the clerk of superior court of any county in which it has an office a limited liability partnership election (O.C.G.A. Section 14-8-62). (This section was revised effective August 18, 2005 to add the last four sentences relating to limited liability partnerships.)

11.2 Statements of Partnership


UPA Section 10.1 (O.C.G.A. Section 14-8-10.1) authorizes the filing by a general partnership of a “statement of partnership” in the office of the clerk of the superior court of any county. Among other things such a statement may disclose limitations on the authority of one or more partners to act on behalf of the partnership. The existence of facts disclosed in a statement of partnership are conclusively presumed in favor of the partnership and against the grantee from the partnership, or a person claiming through such grantee, of partnership real property located in a county within which a statement of partnership or a certified copy thereof has been recorded. Accordingly, the examiner should determine whether a statement of partnership has been recorded by any partnership with an instrument in the title in the county in which the real property is located. If a statement of partnership has been so recorded, the examiner should consider the effect of the facts stated therein. Facts stated in a statement of partnership are conclusively presumed against the partnership if the statement has been recorded in any county. Accordingly, the examiner may wish to establish, by affidavit or otherwise, whether a partnership with an instrument in the title has filed a statement of partnership in a county other than the county in which the real property is located. Similarly, the examiner may wish to establish, by affidavit or otherwise, whether an affidavit of the kind authorized by O.C.G.A. Section 14-8-10.1(f) (which in some circumstances can negate the conclusive presumptions against a partnership established by a statement of partnership) has been recorded.

11.3 Vesting of Property of Dissolved Partnerships


If a partnership with an instrument in the title is dissolved, the examiner should consider the provisions of O.C.G.A. Section 14-8-38.1 and -38.2, which provide, respectively, as follows:

“When a partnership is dissolved for any reason, either pursuant to the provisions of this chapter or the partnership agreement or otherwise, and the business is continued as a partnership, the title to any real property or other property vested in such dissolved partnership shall, by operation of law, be vested in the partnership continuing the business without reversion or impairment and without further act or deed or other instrument of transfer or conveyance.” “In every instance prior to July 1, 1989, where a partnership has been dissolved for any reason, either pursuant to the provisions of this chapter or the partnership agreement or otherwise and the business is continued as a partnership, but no need or other instrument of transfer or conveyance for any real property or other property to the partnership continuing the business has been duly executed and properly recorded, title to such real property or other property, shall, by operation of law, be vested in such partnership continuing the business without reversion or impairment and in as valid and effectual a manner in every case as if a deed or other instrument of transfer or conveyance from such dissolved partnership to such partnership continuing the business had been duly executed and properly recorded.”

11.4 Conveyances of Real Property Prior to UPA Held in Partnership Name


Prior to UPA, real property acquired by a partnership and held in the name of the partnership generally could be conveyed, in such name, only by an instrument executed by all general partners unless otherwise provided by recorded instrument executed by all partners.

Comment: See Hammond v. Chastain, 230 GA. 747, 199 S.E.2d 237 (1973).

11.5 Conveyances of Real Property Subsequent to UPA Held in Name of Partnership Formed Prior to UPA


Subsequent to UPA (April 1, 1985) a conveyance of real property acquired prior to UPA and held in the name of a partnership formed prior to UPA can be conveyed in such name only by an instrument executed by all general partners unless otherwise provided by recorded instrument executed by all partners.