The Cape and Natal Special Partnerships Limited Liability Acts. A statutory history

Jj Henning

doi:10.17159/2411-7870/2015/v21n2a3

Abstract

The origins of the Cape Special Partnerships Limited Liability Act of 1861 and the Natal Special Partnerships Limited Liability Act of 1864 have been open to question for quite some time in South Africa. The view that it was taken over directly from the United Kingdom cannot be supported. This contribution traces the origins of this legislation through the limited partnership legislation of New Zealand and Australia, back to the influential New York Limited Partnerships Act of 1822, and even further back to the very first limited partnership legislation in a common-law jurisdiction, namely the Irish Anonymous Partnerships Act of 1781, French Code de Commerce and Louis XIV's Ordinance Pour le Commerce of 1673. This supports a conclusion that in the latter Ordinance, limited partnership legislation and the partnership encommandite ultimately share a remote ancestor. In addition, attention is drawn briefly to the fortunes of the Natal and, especially, the Cape legislation in South Africa and four other jurisdictions in Southern Africa.

Highlights

Limited partnerships were provided for in the Cape and Natal colonies by the Cape Special Partnerships Limited Liability Act of 18611 and the Natal Special Partnerships Limited Liability Act of 18642 respectively
A limited partnership consists of one or more general partners, who are liable for all the debts and obligations of the firm and entitled to manage the firm’s affairs, as well as one or more limited partners, whose liability for the debts and obligations of the firm is limited in amount and who are excluded from management functions
The limited partnership did not prove very popular, and the Cape and Natal enactments were eventually repealed in South Africa, the importance of these colonial statutes in the context of the South African law of partnership should not be underestimated or ignored

Summary

Introduction

Limited partnership legislation in common-law jurisdictions was initially inspired by the French société en commandite.[10]. The three Australian statutes and the New Zealand Act authorised limited or special partnerships consisting of any number of members to transact agricultural, mining, mercantile, mechanical, manufacturing or other business, except banking and insurance. The members of these partnerships could be either general or special partners.[109] General partners were liable jointly and severally for partnership debts and obligations. It has been said that the New Zealand Special Partnerships Act of 1858 is based on the Irish Anonymous Partnerships Act of 1781,131 the comparison shows a markedly closer affinity between the New Zealand statute, the three Australian statutes of 1853 and the New York Limited Partnerships Act as revised in 1829, than between the New Zealand and Irish legislation

Cape and Natal Acts

Findings

Conclusion