48-1-4. Rules for determining the existence of a partnership.
In determining whether a partnership exists these rules shall apply:
(1) Except as provided by Section 48-1-13, persons who are not partners as to each other
are not partners as to third persons.
(2) Joint tenancy, tenancy in common, tenancy by 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 employee 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 amounts 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.
No Change Since 1953
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Last revised: Wednesday, July 23, 2008