Closely-Held Business Symposium: The Uniform Limited Partnership Act
In a previous article, we stated that the drafters of unincorporated organization statutes, including the Uniform Limited Partnership Act (2001) (ULPA) and the Uniform Limited Liability Company Act (ULLCA), should proceed from a clearly articulated theory when structuring information access and disclosure provisions, and correlative fiduciary duties. One purpose of business organization law is to mediate the inherent conflict occurring when autonomous and self-interested individuals associate to carry on a collective business, and we identified three overarching theories that showed some promise in developing legal structures affecting participants in unincorporated business organizationsparty autonomy, communitarianism, and structuralism. In our view, the drafters of unincorporated business organization legislation should adopt what we termed the structural approach in defining owner and manager fiduciary duties and information disclosure rights. This approach would consider the actual relationships among the firms owners and would recognize that members can have different participation levels in the organization. Under the structural approach, when ownership and management authority converge the law should assume greater information disclosure rights and increased fiduciary duties, and when there is little or no convergence between ownership and management authority, the law should assume reduced information rights and reduced fiduciary duties. . . .