Partnerships Statute Law Amendment Act, 1998 Tsubouchi, Hon. David H. Minister of Consumer and Commercial Relations — Bill 6 (36th Parliament, 2nd Session)

Bill 6, 36-2

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Bill 6, Partnerships Statute Law Amendment Act, 1998

Tsubouchi, Hon. David H. Minister of Consumer and Commercial Relations

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[36] Bill 6 Original (PDF)

B006_E

Bill 6 1998

An Act to amend the law

with respect to Partnerships

Her Majesty, by and with the advice and consent of the Legislative

Assembly of the Province of Ontario, enacts as follows:

PARTNERSHIPS ACT

1. Subsection 1 (1) of the Partnerships Act is amended by

adding the following

definitions:

extra-provincial limited liability partnership" means a limited liability

partnership formed under the laws of another jurisdiction but does not

include an extra-provincial limited partnership within the meaning of the

Limited Partnerships Act\; ("société à

responsabilité limitée extraprovinciale")

limited liability partnership" means a partnership, other than a limited

partnership, that is formed or continued as a limited liability partnership

under

section 44.1 or that is an extra-provincial limited liability

partnership. ("société à responsabilité

limitée")

(1) Section 10 of the Act is amended by adding at the beginning

"Except as provided in subsection (2)".

(2) Section 10 of the Act is amended by adding the following

subsections:

Limited liability partnerships

(2) Subject to subsection (3), a partner in a limited liability

partnership is not liable, by means of indemnification, contribution,

assessment or otherwise, for debts, obligations and liabilities of the

partnership or any partner arising from negligent acts or omissions that

another partner or an employee, agent or representative of the partnership

commits in the course of the partnership business while the partnership is a

limited liability partnership.

Liability of negligent partner

(3) Subsection (2) does not affect the liability of a partner in a limited

liability partnership for the partner's own negligence or the negligence of a

person under the partner's direct supervision or control.

Partner not proper party to action

(4) A partner in a limited liability partnership is not a proper party to

a proceeding by or against the limited liability partnership for the purpose

of recovering damages or enforcing obligations arising out of the negligent

acts or omissions described in subsection (2).

Extra-provincial limited liability partnerships

(5) This

section does not apply to an extra-provincial limited liability

partnership.

Section 13 of the Act is amended by adding at the beginning

"Except as provided in subsection 10 (2)".

(1) Paragraph 1 of

section 24 of the Act is repealed and the

following substituted:

1. All the partners are entitled to share equally in the capital and

profits of the business, and must contribute equally towards the losses,

whether of capital or otherwise, sustained by the firm, but a partner shall

not be liable to contribute toward losses arising from a liability for which

the partner is not liable under subsection 10 (2).

(2) Section 24 of the Act is amended by adding the following

paragraph:

2.1 A partner is not required to indemnify the firm or other partners in

respect of debts or obligations of the partnership for which a partner is not

liable under subsection 10 (2).

5. Paragraph 1 of

section 44 of the Act is repealed and the

following substituted:

1. Losses, including losses and deficiencies of capital, are to be paid

first out of profits, next out of capital, and lastly, if necessary, by the

partners individually in the proportion in which they were entitled to share

profits, but a partner is not required to pay any loss arising from a

liability for which the partner is not liable under subsection 10 (2).

6. The Act is amended by adding the following

sections:

Limited Liability Partnerships

Formation

44.1

(1) A limited liability partnership that is not an

extra-provincial limited liability partnership is formed when two or more

persons enter into a written agreement that,

(

a) designates the partnership as a limited liability partnership; and

(

b) states that this Act governs the agreement.

Continuance

(2) A partnership may be continued as a limited liability partnership that

is not an extra-provincial limited liability partnership if all of the

partners,

(

a) enter into an agreement that continues the partnership as a limited

liability partnership and states that this Act governs the agreement; or

(

b) if there is an existing agreement between the partners that forms the

partnership, amend the agreement to designate the partnership as a limited

liability partnership and to state that this Act governs the agreement.

Effect of continuance

(3) Upon the continuance of a partnership as a limited liability

partnership under subsection (2),

(

a) the limited liability partnership possesses all the property, rights,

privileges and franchises and is subject to all liabilities, including civil,

criminal and quasi-criminal, and all contracts, disabilities and debts of the

partnership which were in existence immediately before the continuance;

and

(

b) all persons who were partners immediately before the continuance

remain liable for all debts, obligations and liabilities of the partnership

or all partners with respect to the other partners that arose before the

continuance.

Limitation on business activity

44.2 A limited liability partnership may carry on

business in Ontario only for the purpose of practising a profession governed

by

an Act and only if,

(

a) that Act expressly permits a limited liability partnership to practise

the profession;

(

b) the governing body of the profession requires the partnership to

maintain a minimum amount of liability insurance; and

(

c) the partnership complies with

section 44.3 if it is not an

extra-provincial limited liability partnership or

section 44.4 if it is an

extra-provincial limited liability partnership.

Business name

44.3

(1) No limited liability partnership formed or

continued by an agreement governed by this Act shall carry on business unless

it has registered its firm name under the Business Names Act.

Amendments, cancellations and renewals

(2) To amend, renew or cancel a registration of its firm name, a limited

liability partnership mentioned in subsection (1) shall register an

amendment, renewal or cancellation of a registration in accordance with the

requirements of the Business Names Act .

Name

(3) The name of a limited liability partnership mentioned in subsection

(1) shall contain the words "limited liability partnership" or

"société à responsabilité limitée" or the

abbreviations "LLP", "L.L.P." or "s.r.l." as the last words or letters of its

name.

Use of registered name only

(4) No limited liability partnership mentioned in subsection (1) shall

carry on business under a name other than its registered firm name.

Right to carry on business outside of Ontario

(5) Nothing in this Act prevents a limited liability partnership mentioned

in subsection (1) from carrying on its business and exercising its powers in

any province or territory of Canada or any other country.

7. The Act is amended by adding the following

section:

Extra-provincial limited liability partnerships

44.4

(1) No extra-provincial limited liability

partnership shall carry on business in Ontario unless it has registered its

name under the Business Names Act.

Amendments, cancellations and renewals

(2) To amend, renew or cancel a registration of its firm name, an

extra-provincial limited liability partnership shall register an amendment,

renewal or cancellation of a registration in accordance with the requirements

of the Business Names Act .

Use of registered name only

(3) No extra-provincial limited liability partnership shall carry on

business under a name other than its registered firm name.

Laws of other jurisdiction

(4) The laws of the jurisdiction under which an extra-provincial limited

liability partnership is formed shall govern,

(

a) its organization and internal affairs; and

(

b) the liability of its partners for debts, obligations and liabilities

of or chargeable to the partnership or any of its partners.

Service

(5) A person may serve a notice or document on an extra-provincial limited

liability partnership at its Ontario place of business, if any, or its

address required to be maintained under the laws of the jurisdiction of

formation or its principal office address.

8. The Act is amended by adding the following heading immediately

before

section 45:

General

COMPLEMENTARY AMENDMENTS

9. Subsection 4 (1) of the Business Names Act , as

re-enacted by the Statutes of Ontario, 1994,

chapter 27,

section 72, is

amended by adding at the end "or

section 44.3 or 44.4 of the Partnerships

Act" .

10. The Chartered Accountants Act, 1956 is amended by

adding the following section:

Limited liability partnership

13.1 Two or more members of the Institute may form a

limited liability partnership or continue a partnership as a limited

liability partnership within the meaning of the Partnerships Act for

the purpose of practising as a chartered accountant.

COMMENCEMENT AND

SHORT TITLE

Commencement

11. This Act comes into force on a day to be named by proclamation

of the Lieutenant Governor.

Short title

12. The

short title of this Act is the Partnerships Statute

Law Amendment Act, 1998.

Copyright © 1998

Office of the Legislative Assembly of Ontario

Toronto, Ontario, Canada.

Date Bill stage Activity Committee

June 11, 1998

Royal Assent

Royal Assent received

June 3, 1998

Third Reading

Carried

May 13, 1998

Ordered for Third Reading

May 13, 1998

Reported without amendment

May 12, 1998

Consideration of a Bill

Standing Committee on Administration of Justice

May 6, 1998

Ordered referred to Standing Committee

Standing Committee on Administration of Justice

May 6, 1998

Second Reading

Carried

April 28, 1998

First Reading

Carried

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Document details

Collection	Ontario — Bills
Citation	Bill 6, 36-2
Type	bill
Volume / chapter	p36 s2 bill 6 html
Language	en
Format	html
Source	PROVINCIAL
Identifier	45041f153375a3dd6168259b50aa5d97f1765c74

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