178.04 Determination of whether partnership exists. - Wisconsin Statutes

178.04

178.04 Determination of whether partnership exists. In determining whether a partnership exists, these rules shall apply:

178.04(1)

(1) Except as provided by s. 178.13, persons who are not partners as to each other are not partners as to 3rd persons.

178.04(2)

(2) Joint tenancy, tenancy in common, tenancy by the entireties, joint property, common property, or part ownership does not of itself establish a partnership, whether such co-owners do or do not share any profits made by the use of the property.

178.04(3)

(3) The sharing of gross returns does not of itself establish a partnership, whether or not the persons sharing them have a joint or common right or interest in any property from which the returns are derived.

178.04(4)

(4) The receipt by a person of a share of the profits of a business is prima facie evidence that that person is a partner in the business, but that inference shall not be drawn if the profits were received for any of the following:

178.04(4)(a)

(a) As payment as a debt by installments or otherwise.

178.04(4)(b)

(b) As wages of an employee or rent to a landlord.

178.04(4)(c)

(c) As an annuity to a surviving spouse or representative of a deceased partner.

178.04(4)(d)

(d) As interest on a loan, though the amount of payment vary with the profits of the business.

178.04(4)(e)

(e) As the consideration for the sale of the goodwill of a business or other property by installments or otherwise.

178.04 - ANNOT.

History: 1975 c. 94 s. 91 (5); 1975 c. 199; 1993 a. 491; 1997 a. 254; 2005 a. 253.

178.04 - ANNOT.

The receipt of a share of profits is prima facie evidence that a person is a partner, but a partnership will not be implied merely because of common ownership of property, whether or not profits are shared. Anderson v. Anderson, 54 Wis. 2d 666, 196 N.W.2d 727 (1972).

178.04 - ANNOT.

Except when all parties have performed the contract, thus indicating their acquiescence in its terms, a partnership created to deal in real estate is void unless it conforms to the statute of frauds. Estate of Schaefer, 72 Wis. 2d 600, 241 N.W.2d 607 (1976).