Differentiating a general partnership from a limited partnership
General Partnership Limited Partnership
How constituted May be constituted in any
form by contract or
conduct of the parties ;
Can be constituted orally
Registration requirement No need of SEC
registration
Composition All general partners
Liability All are personally liable for
partnership obligations
even beyond their
contributions
Contribution Cash, property or services
or a combination of any of
the ones mentioned
Management of the All partners have an equal
company right in the management if
manner not agreed upon
Suit by or against the Must sue in the name of
partnership the partnership;
General partner can be a
proper party to the
proceedings
Assignment of one’s Assignee acquires interest
interest of the partners but needs
the consent of the other
partners to make him a
partner
Formed only by
compliance with the
statutory requirements;
Cannot be constituted
orally
Requires SEC registration
One or more general
partners and one or more
limited partners;
1 limited partner is enough
under the law
The limited partner is liable
only up to the extent of his
contribution; not beyond
A limited partner can only
contribute money or
property but not services
If a limited partner
contributes both cash and
services or property and
services he becomes a
general-limited partner;
If he is a limited partner
and he contributes only
services he becomes a
general partner
No participation in the
management of the
business (akin to that of a
silent or dormant partner in
a general partnership)
Must sue in the name of
the partnership;
Limited partner not a
proper party to the
proceedings ; only a
general partner can be a
proper party to the
proceedings
Limited partner’s interest is
freely assignable.
If limited partner is
empowered by the
certificate to make the
assignee the substituted
limited partner, he
becomes such; if not all
partners must give their
consent

Charging of interest and
redemption of partner’s
interest
Retirement, death, civil
interdiction, insanity or
insolvency of a partner
Notice of dissolution
Winding up
Priority in asset distribution
after
Interest of a partner may
be charged ;
A partner’s interest may be
redeemed not only with the
separate property of one of
more general partners but
also with partnership
property
Change in the relation of
partners is a cause for
dissolution whether judicial
or extrajudicial .
Notice of dissolution is
given; certificate with SEC
is cancelled if registered
Same rules
1. Those owing to the
creditors other than
partners
2. Those owing to
partners other than
for capital and profits
3. Those owing to
partners in respect of
capita
4. Those owing to
partners in respect of
profits
In both cases, there must
be an amendment of the
certificate
Interest of a limited partner
may be subject to
attachment or execution;
A partner’s interest may be
redeemed not only with the
separate property of one
of more general partners
but not with partnership
property
If partner is a general
partner – it dissolves the
partnership ;
If partner is a limited
partner – partnership not
dissolved ; except if there
is no limited partner left
Notice of dissolution is not
necessary since what is
required is merely the
cancellation of the
certificate.
Same rules
Priority in Distribution of
Assets:
1. Those due to creditors,
including limited
partners
2. Those due to limited
partners in respect of
their share in
profits/compensation
3. Those due to limited
partners for return of
capital contributed
4. Those due to general
partner other than
capital & profits
5. Those due to general
partner in respect to
profits
6. Those due to general
partner for return of
capital contributed