Question: Madison Real Estate is a limited partner of KanAm USA

Madison Real Estate is a limited partner of KanAm USA XIX Limited Partnership. The partnership agreement sets out the rights and obligations of the limited partners and the general partner and provides limited partners with a right to inspect the partner- ship's books of account. Specifically, it states: "The General Partner shall cause complete and accurate books of account to be kept for the Partnership, which shall be available for examination by the Partners during normal business hours. The fiscal year of the Partnership shall be the calendar year and the books of account shall be closed as of the end of each year."
Madison requested inspection of books and records from the partnership, including rent rolls for proper- ties and terms and conditions of property debt. The purpose of the demand was for Madison to "properly value its investment in the partnership." KanAm refused. Madison sued, alleging that by refusing to make available the requested books and records, KanAm breached the Uniform Limited Partnership Act and the partnership agreement. The court had to consider whether the limited partner's primary purpose for inspecting the books was reasonably related to its limited partner interests and, thus, was a proper purpose for inspection. Do you think the purpose for inspecting the books was related to the interests of the limited partner? In other words, do you think the court said this limited partner should be allowed to inspect the books? Recall the differences between general and limited partners when you answer these questions.

View Solution:

Sale on SolutionInn
  • CreatedOctober 21, 2015
  • Files Included
Post your question