67-410. Formation of partnership.
(1) Except as otherwise provided in subsection (2) of this section, the association of two or more persons to carry on as co-owners a business for profit forms a partnership, whether or not the persons intend to form a partnership.
(2) An association formed under a statute other than the Uniform Partnership Act of 1998, a predecessor statute, or a comparable statute of another jurisdiction is not a partnership under the act.
(3) In determining whether a partnership is formed, the following rules apply:
(a) Joint tenancy, tenancy in common, tenancy by the entireties, joint property, common property, or part ownership does not by itself establish a partnership, even if the co-owners share profits made by the use of the property;
(b) The sharing of gross returns does not by itself establish a partnership, even if the persons sharing them have a joint or common right or interest in property from which the returns are derived; and
(c) A person who receives a share of the profits of a business is presumed to be a partner in the business, unless the profits were received in payment:
(i) Of a debt by installments or otherwise;
(ii) For services as an independent contractor or of wages or other compensation to an employee;
(iii) Of rent;
(iv) Of an annuity or other retirement or health benefit to a beneficiary, representative, or designee of a deceased or retired partner;
(v) Of interest or other charge on a loan, even if the amount of payment varies with the profits of the business, including a direct or indirect present or future ownership of the collateral, or rights to income, proceeds, or increase in value derived from the collateral; or
(vi) For the sale of the goodwill of a business or other property by installments or otherwise.
Source
Annotations
A business qualifies as a partnership under the "business for profit" element of subsection (1) of this section so long as the parties intended to carry on a business with the expectation of profits. In re Dissolution & Winding Up of KeyTronics, 274 Neb. 936, 744 N.W.2d 425 (2008).
Being "co-owners" of a business for profit does not refer to the co-ownership of property, but to the co-ownership of the business intended to garner profits. In re Dissolution & Winding Up of KeyTronics, 274 Neb. 936, 744 N.W.2d 425 (2008).
If the parties' voluntary actions objectively form a relationship in which they carry on as co-owners of a business for profit, then they may inadvertently create a partnership despite their expressed subjective intention not to do so. In re Dissolution & Winding Up of KeyTronics, 274 Neb. 936, 744 N.W.2d 425 (2008).
In both actions inter sese between alleged partners and actions by a third party against an alleged partnership, the party asserting the existence of a partnership must prove that relationship by a preponderance of the evidence. In re Dissolution & Winding Up of KeyTronics, 274 Neb. 936, 744 N.W.2d 425 (2008).
In considering the parties' intent to form an association, it is generally considered relevant how the parties characterize their relationship or how they have previously referred to one another. In re Dissolution & Winding Up of KeyTronics, 274 Neb. 936, 744 N.W.2d 425 (2008).
The objective indicia of co-ownership required for a partnership are commonly considered to be (1) profit sharing, (2) control sharing, (3) loss sharing, (4) contribution, and (5) co-ownership of property, but no single indicium is either necessary or sufficient to prove co-ownership. In re Dissolution & Winding Up of KeyTronics, 274 Neb. 936, 744 N.W.2d 425 (2008).