449.7 Rules for determining existence of partnership.

255 words·~1 min read·/mi/chapter-449/449-7

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Sec. 7.

(Rules for determining the existence of a partnership). In determining whether a partnership exists, these rules shall apply:

(1)Except as provided by section 16 persons who are not partners as to each other are not partners as to third persons;

(2)Joint tenancy, tenancy in common, tenancy by the entireties, joint property, common property, or part ownership does not of itself establish a partnership, whether such co-owners do or do not share any profits made by the use of the property;

(3)The sharing of gross returns does not of itself establish a partnership, whether or not the persons sharing them have a joint or common right or interest in any property from which the returns are derived;

(4)The receipt by a person of a share of the profits of a business is prima facie evidence that he is a partner in the business, but no such inference shall be drawn if such profits were received in payment:

(a)As a debt by installments or otherwise,

(b)As wages of an employe or rent to a landlord,

(c)As an annuity to a widow or representative of a deceased partner,

(d)As interest on a loan, though the amount of payment vary with the profits of the business,

(e)As the consideration for the sale of the good-will of a business or other property by installments or otherwise.

History: 1917, Act 72, Eff. Aug. 10, 1917 ;-- CL 1929, 9847 ;-- CL 1948, 449.7