ry relation ood faith y and a d e of its Lucinda to invest in the company. A low

Question

ry relation ood faith y and a d e of its Lucinda to invest in the company. A low bridge sepa- rated Oil Build's rig construction site from the open sea. Grant admitted that this setup could increase the cost to deliver the rigs out to sea, but he assured Lucinda that the cost increase would not be significant. Lucinda agreed to invest $10 million and became a limited part- ner. Oil Build's bids proved too high for the company to obtain work. Without informing Lucinda, Grant sold the limited partnership's assets and pocketed the profits. dverse o on- Did Grant owe and subsequently breach a duty to Lucinda? Yes. General partners owe the part- nership a duty of altyand a duty of and Ohedienre, as well as an obligation to discharge in a reasonable belief that they are acting in the best of the partnership. General partners their duties in owe their co-partners, including any limited partners, the highest fiduciary duty. Here, Grant was the general partner. He owed Lucinda, the firm's limited partner, this duty. He breached the duty by misrepresenting the significance of the low bridge, by selling the firm's assets without notifying her, and by pocketing the profits.

Explanation / Answer

General partners owe the partnership a duty of loyality and a duty of obedience aswell as an obligation to discharge their duties in optimum manner and in a reasonable belief that they are acting in the best interest of the partnership.

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