SECTIONS 16201-16204 - California Statutes

CORPORATIONS CODE

SECTION 16201-16204

16201. A partnership is an entity distinct from its partners.

16202. (a) Except as otherwise provided in subdivision (b), the
association of two or more persons to carry on as coowners a business
for profit forms a partnership, whether or not the persons intend to
form a partnership.
(b) An association formed under a statute other than this chapter,
a predecessor statute, or a comparable statute of another
jurisdiction is not a partnership under this chapter.
(c) In determining whether a partnership is formed, the following
rules apply:
(1) Joint tenancy, tenancy in common, tenancy by the entireties,
joint property, common property, or part ownership does not by itself
establish a partnership, even if the coowners share profits made by
the use of the property.
(2) The sharing of gross returns does not by itself establish a
partnership, even if the persons sharing them have a joint or common
right or interest in property from which the returns are derived.
(3) A person who receives a share of the profits of a business is
presumed to be a partner in the business, unless the profits were
received for any of the following reasons:
(A) In payment of a debt by installments or otherwise.
(B) In payment for services as an independent contractor or of
wages or other compensation to an employee.
(C) In payment of rent.
(D) In payment of an annuity or other retirement benefit to a
beneficiary, representative, or designee of a deceased or retired
partner.
(E) In payment of interest or other charge on a loan, even if the
amount of payment varies with the profits of the business, including
a direct or indirect present or future ownership of the collateral,
or rights to income, proceeds, or increase in value derived from the
collateral.
(F) In payment for the sale of the goodwill of a business or other
property by installments or otherwise.

16203. Property acquired by a partnership is property of the
partnership and not of the partners individually.

16204. (a) Property is partnership property if acquired in the name
of either of the following:
(1) The partnership.
(2) One or more partners with an indication in the instrument
transferring title to the property of the person's capacity as a
partner or of the existence of a partnership but without an
indication of the name of the partnership.
(b) Property is acquired in the name of the partnership by a
transfer to either of the following:
(1) The partnership in its name.
(2) One or more partners in their capacity as partners in the
partnership, if the name of the partnership is indicated in the
instrument transferring title to the property.
(c) Property is presumed to be partnership property if purchased
with partnership assets, even if not acquired in the name of the
partnership or of one or more partners with an indication in the
instrument transferring title to the property of the person's
capacity as a partner or of the existence of a partnership.
(d) Property acquired in the name of one or more of the partners,
without an indication in the instrument transferring title to the
property of the person's capacity as a partner or of the existence of
a partnership and without use of partnership assets, is presumed to
be separate property, even if used for partnership purposes.