Legal Question in Business Law in California

Re: general partner liability

Depending on the specific circumnstances, yes. General partners are usually responsible for their partners business actions in relation to the partnership. While you might be able to claim that your partner was acting outside of the business, you will still be expected to have kept "an eye" on your partner. If you feel there is something where your partner made you liable, obtain counsel immediately.

I would also mentino that likely your partner will be liable to you for any funds monetary damages you had to pay becuase of his action. But if he is insolvent, or skipped town, that doesn't help you a lot. Once again, find an attorney. This is one of the major reasons why general partnerships are usually discouraged.

Re: general partner liability

That's what makes a partnership so dangerous; you are liable for anything other partners do. I NEVER recommend a partnership, only corporations for businesses. Time for you to get an attorney, quickly. Feel free to contact if you decide to take this risk seriously, and if the amount is substantial. You may need to sue the partner and hope they have the ability to repay the loss and cover all the costs of your litigation.

Re: general partner liability

It very much depends upon whether what happened is literally "stealing" and "theft" in a true criminal law sense, or whether you are describing a civil wrong such as conversion and the civil penalty involved.

I can't say it would never happen, but it would be very unusual for a general partner to be prosecuted criminally or to be sentenced to jail for another partner's crimes, even if the crime charged was theft of client money. It would take some kind of conspiracy or wilful blindness to place the requisite criminal intent upon the non-stealing partner.

On the other hand, the same conduct can also be sued upon in a civil action, and the cheated or defrauded third party can recover from either or both partners at his option. That would leave you with a right to obtain indemnification or contribution from your wrongdoing partner to the extent you had to cough up money to cover a judgment.