McBride Law Blog

Can a Partner Be Held Liable for a Partnership Debt in Texas? (Part I)

McBride Law Blog

// Staff of the Firm // No Comments »

In our previous blog series on general partnership, we talked about what general partnership is and why it is important for business owners to know about it.  We wrote that, despite the advent of limited liability companies (LLCs), business owners frequently form a general partnership, oftentimes without even realizing it.  Generally speaking, partners in a general partnership are jointly and severally liable, and each partner is personally and individually liable for the entire amount of all partnership obligations.  For example, if your partnership owes an amount to a supplier, you, along with the other individual partner(s), would be personally liable if the partnership fails to pay the supplier– whether you intended to be a partner or whether you knew you were exposed to such liability.

So how do partners in a general partnership become subject to partnership debts?  What is the process?  The case of American Star Energy and Minerals Corporation v. Stowers[1] is one example of where a creditor pursued legal action against the individual partners of a partnership, under Texas law, for a partnership debt.

This post was part of a multi-part series on enforcing a partner’s liability for a partnership debt.  You can find the other posts by searching our blogs at www.mcbrideattorneys.com.  In our next post, we will discuss the details of the case.

This posting is intended to be a planning tool to familiarize readers with some of the high-level issues discussed herein.  This is not meant to be a comprehensive discussion and additional details should be discussed with your transaction planners including attorneys, accountants, consultants, bankers and other business planners who can provide advice for your circumstances.  This article should not be treated as legal advice to any person or entity.

Steps have been taken to verify the contents of this article prior to publication.  However, readers should not, and may not, rely on this article.  Please consult with counsel to verify all contents and do not rely solely on this article in planning your legal transactions.

[1] Am. Star Energy & Minerals Corp. v. Stowers, No. 13-0484 (Tex. Oct. 14, 2014).  Unless otherwise specified, all references to the case are from this citation.

Facebooktwittergoogle_pluslinkedinmailAbout the Author Shawn works successful, private business owners in their growth and missions to make a company that stands the test of time. You can email or call (214) 418-0258.

Leave a Reply


Error: Please enter a valid email address

Error: Invalid email

Error: Please enter your first name

Error: Please enter your last name

Error: Please enter a username

Error: Please enter a password

Error: Please confirm your password

Error: Password and password confirmation do not match