1. (a) Each partner is deemed to have an account that is:

   1. (1) credited with an amount equal to the money plus the value of any other property, net of the amount of any liabilities, the partner contributes to the partnership and the partner's share of the partnership profits; and
   2. (2) charged with an amount equal to the money plus the value of any other property, net of the amount of any liabilities, distributed by the partnership to the partner and the partner's share of the partnership losses.
2. (b) Each partner is entitled to an equal share of the partnership profits and, except as otherwise provided in Section 306 [54-1A-306 NMSA 1978] and Section 54-1-48 NMSA 1978, is chargeable with a share of the partnership losses in proportion to the partner's share of the profits.
3. (c) A partnership shall reimburse a partner for payments made and indemnify a partner for liabilities incurred by the partner in the ordinary course of the business of the partnership or for the preservation of its business or property.
4. (d) A partnership shall reimburse a partner for an advance to the partnership beyond the amount of capital the partner agreed to contribute.
5. (e) A payment or advance made by a partner which gives rise to a partnership obligation under Subsection (c) or (d) constitutes a loan to the partnership which accrues interest from the date of the payment or advance.
6. (f) Each partner has equal rights in the management and conduct of the partnership business.
7. (g) A partner may use or possess partnership property only on behalf of the partnership.
8. (h) A partner is not entitled to remuneration for services performed for the partnership, except for reasonable compensation for services rendered in winding up the business of the partnership.
9. (i) A person may become a partner only with the consent of all of the partners.
10. (j) A difference arising as to a matter in the ordinary course of business of a partnership may be decided by a majority of the partners. An act outside the ordinary course of business of a partnership and an amendment to the partnership agreement may be undertaken only with the consent of all of the partners.
11. (k) This section does not affect the obligations of a partnership to other persons under Section 301 [54-1A-301 NMSA 1978].

History: Laws 1996, ch. 53, § 401.

ANNOTATIONS

Compiler's notes. — Section 54-1-48 NMSA 1978, referred to in Subsection (b), was repealed in 1997.

Former Section 54-1-18 NMSA 1978 was merely a declaration of common law. Dale v. Dale, 1953-NMSC-081, 57 N.M. 593, 261 P.2d 438.

Agreement to divide assets of partnership upon dissolution need not be formally expressed in writing, but may be inferred or established, in whole or in part, from the acts of the parties. Citizens Bank v. Williams, 1981-NMSC-059, 96 N.M. 373, 630 P.2d 1228.

Neither partner may impose his will upon the other. — Under former Section 54-1-18 NMSA 1978, when a partnership consists of two partners, neither partner had the right to impose his will concerning the operation of the partnership upon the other. Covalt v. High, 1983-NMCA-145, 100 N.M. 700, 675 P.2d 999, cert. denied, 100 N.M. 631, 674 P.2d 521.

Partner entitled to personal judgment. — The court, acting under equitable principles, properly disregarded a corporation's corporate form and entered a personal judgment in favor of the liquidating partner who, through the corporation of which that partner was the majority stockholder, had paid the partnership's obligations and incurred costs for the preservation of partnership property. Levy v. Disharoon, 1988-NMSC-009, 106 N.M. 699, 749 P.2d 84.

Proof of partnership agreements. — The fiduciary duties between partners do not necessarily raise the level of proof of partnership agreements from ordinary proof to one of clear and convincing proof. Citizens Bank v. Williams, 1981-NMSC-059, 96 N.M. 373, 630 P.2d 1228.

Partner may not recover damages for copartner's failure to negotiate and execute transaction. — When a partnership consists of two partners, in the absence of a mutual agreement, one partner may not recover damages for the failure of a copartner to negotiate and execute a transaction, the remedy for such an impasse being dissolution of the partnership. Covalt v. High, 1983-NMCA-145, 100 N.M. 700, 675 P.2d 999, cert. denied, 100 N.M. 631, 674 P.2d 521.

A managing partner is not entitled to compensation for individual services rendered in the absence of an agreement therefor. Dale v. Dale, 1953-NMSC-081, 57 N.M. 593, 261 P.2d 438.

A managing partner, whose wife's earnings were community property, was not receiving compensation in absence of an agreement where the wife had been employed by agreement of the partners. Dale v. Dale, 1953-NMSC-081, 57 N.M. 593, 261 P.2d 438.

Law reviews. — For note, "The Fiduciary Duties Owed in a New Mexico Closely Held Corporation: Walta v. Gallegos Law Firm, P.C.," see 34 N.M.L. Rev. 181 (2004).

Am. Jur. 2d, A.L.R. and C.J.S. references. — 59A Am. Jur. 2d Partnership § 409 et seq.

Actions at law between partners and partnerships, 58 A.L.R. 621, 168 A.L.R. 1088.

Right of partners inter se in respect of interest, 66 A.L.R. 3

Accountability of partners for profits earned subsequent to death or dissolution, 80 A.L.R. 12, 55 A.L.R.2d 1391.

Right of partner or member of joint adventure to share in misappropriated money, property or secret profits for which that partner is required to account, 118 A.L.R. 640.

Duty of one who joins with others as partners or members of a joint adventure in the purchase of property from a third person to share with them the benefit of an existing option or executory contract for the property, 152 A.L.R. 1001.

Provision of partnership agreement giving one partner option to buy out the other, 160 A.L.R. 523.

Duty of former partner, acquiring property occupied by partnership business, to renew lease, 4 A.L.R.2d 102.

Powers, duties and accounting responsibilities of managing partner of mining partnership, 24 A.L.R.2d 1359.

Right of partner to account where firm business or transactions are illegal, 32 A.L.R.2d 1345.

Lessee interest of individual as becoming partnership asset of firm subsequently formed, 37 A.L.R.2d 1076.

Meaning and coverage of "book value" in partnership agreement in determining value of partner's interest, 47 A.L.R.2d 1425.

Unemployment compensation for partner, 65 A.L.R.2d 1185.

Salaries of partners, contract as to, 66 A.L.R.2d 1023.

Winding up: construction and application of section 18(f) of Uniform Partnership Act as to surviving partner's right to compensation for services in winding up partnership, 81 A.L.R.2d 445.

Relative rights of surviving partner and the estate of the deceased partner in proceeds of life insurance acquired pursuant to partnership agreement, 83 A.L.R.2d 1347.

Partner's breach of fiduciary duty to copartner on sale of partnership interest to another partner, 4 A.L.R.4th 1122.

Civil liability of one partner to another or to the partnership based on partner's personal purchase of partnership property during existence of partnership, 37 A.L.R.4th 494.

Joint venturers' comparative liability for losses, in absence of express agreement, 51 A.L.R.4th 371.

68 C.J.S. Partnership § 76.