Mont. Code Ann. » TITLE 35. CORPORATIONS, PARTNERSHIPS, AND ASSOCIATIONS · CHAPTER 10. PARTNERSHIPS IN GENERAL · Part 4. Relation of Partners to Partnership and to One Another
Montana Code Annotated

Mont. Code Ann. § 35-10-405 (2026)

General Standards Of Partner's Conduct

✓ current as of May 2026
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  1. MCA Contents
  2. TITLE 35
  3. CHAPTER 10
  4. Part 4
  5. 35-10-405 General standards of partner's conduct

TITLE 35. CORPORATIONS, PARTNERSHIPS, AND ASSOCIATIONS

CHAPTER 10. PARTNERSHIPS IN GENERAL

Part 4. Relation of Partners to Partnership and to One Another

General Standards Of Partner's Conduct

35-10-405. General standards of partner's conduct. (1) The only fiduciary duties a partner owes to the partnership and the other partners are the duty of loyalty and the duty of care set forth in this section.

(2) A partner's duty of loyalty to the partnership and the other partners is limited to the following:

(a) to account to the partnership and hold as trustee for it any property, profit, or benefit derived:

(i) by the partner in the conduct and winding up of the partnership business;

(ii) from a use or appropriation by the partner of partnership property; or

(iii) from a use or appropriation of an opportunity without the consent of the other partners;

(b) to refrain from dealing with the partnership in the conduct or winding up of the partnership business as or on behalf of a party having an interest adverse to the partnership without the consent of the other partners; and

(c) to refrain from competing with the partnership in the conduct of partnership business before the dissolution of the partnership without the consent of the other partners.

(3) A partner's duty of loyalty may not be eliminated by agreement, but the partners by agreement may identify specific types or categories of activities that do not violate the duty of loyalty, if not manifestly unreasonable.

(4) A partner's duty of care to the partnership and the other partners in the conduct and winding up of the partnership business is limited to refraining from engaging in grossly negligent or reckless conduct, intentional misconduct, or a knowing violation of law.

(5) A partner shall discharge the duties to the partnership and the other partners under this chapter or under the partnership agreement and exercise any rights consistent with the obligation of good faith and fair dealing. The obligation of good faith and fair dealing may not be eliminated by agreement, but the partners by agreement may determine the standards by which the performance of the obligation is to be measured if the standards are not manifestly unreasonable.

(6) A partner does not violate a duty or obligation under this chapter or under the partnership agreement merely because the partner's conduct furthers the partner's own interest. A partner may lend money to and transact other business with the partnership. The rights and obligations of a partner who lends money to or transacts business with the partnership are the same as those of a person who is not a partner, subject to other applicable law.

(7) This section applies to a person winding up the partnership business as the personal or legal representative of the last surviving partner as if the person were a partner.

History: En. Sec. 21, Ch. 251, L. 1947; R.C.M. 1947, 63-304; amd. Sec. 28, Ch. 238, L. 1993.

Notes of Decisions
Cited in 9 cases (1 in the last 5 years), 1990–2025 · leading case: Phelps v. Frampton, 2007 MT 263 (Mont. 2007).
Sort: Relevance Newest Treatment
Phelps v. Frampton, 2007 MT 263 (Mont. 2007). · cites it 28× “Frampton breached this fiduciary duty of loyalty by claiming and retaining an extraordinarily large sum as his sole property and refusing to pay Phelps his share.”
Baltrusch v. Baltrusch, 2006 MT 51 (Mont. 2006). · cites it 4× “[3] See § 35-10-403, MCA (declaring a partner's duty to furnish complete and accurate information to another partner); § 35-10-405(5), MCA (declaring that a partner must discharge his duties consistent with the obligation of good faith and fair dealing).”
Baltrusch v. Baltrusch, 2003 MT 357 (Mont. 2003). · cites it 6× “Section 35-10-405(1), MCA. Specifically, a partner’s duty of loyalty is limited to: (2)(a) account to the partnership and hold as trustee for it any property, profit, or benefit derived .”
McCormick v. Brevig, 2007 MT 195 (Mont. 2007). · cites it 5× “Section 35-10-405(2)(b), MCA, imposes a duty of loyalty on a partner to refrain from dealing with the partnership as a party having an interest adverse to *385 the partnership, without the consent of the other partners.”
State v. Debus, 2002 MT 307 (Mont. 2002). · cites it 4× “Compare § 35-10-405, MCA, with § 35-1-418, MCA. While the Montana Business Corporation Act does not specifically limit a director's use of corporate property to corporate purposes, the limitation is implied by the duties of good faith and care fundamental to a director's…”
Jackpot Farms v. Johns Farms, 2020 MT 311 (Mont. 2020). · cites it 6× “” Section 35-10- 405(6), MCA (stating further that “[a] partner may lend money to and transact other business with the partnership”).”
Yellowstone Valley Props. v. Eames (In re Eames), 108 B.R. 742 (Bankr. D. Mont. 1990). · cites it 4× “Section 35-10-405(1), M.C.A. states: “Every partner must account to the partnership for any benefit and hold as trustee for it any profits derived by him without the consent of the other partners from any transaction connected with the formation, conduct, or liquidation of the…”
Schwarz v. Liechti (In re Liechti), 543 B.R. 26 (Bankr. D. Mont. 2015). “• The Montana Supreme Court described, as “fiduciary duties,” a partner’s duties of loyalty and care to other partners under MCA §§ 35-10-405(2), (4), and in the discharge of partners’ duty to furnish complete and accurate information concerning a partnership (§ 35-10-403, MCA).”
Matter of: The Potter Exemption Trust, 2025 MT 231 (Mont. 2025). · cites it 4× ““[T]he only fiduciary duties a partner owes to the partnership and the other partners are the duty of loyalty and the duty of care” as set forth in § 35-10-405, MCA. A partner’s duty of loyalty is to account and hold as trustee all partnership property and to avoid conflicts of…”
— Mont. Code Ann. § 35-10-405(1) — 2 cases
Baltrusch v. Baltrusch, 2003 MT 357 (Mont. 2003). “Section 35-10-405(1), MCA. Specifically, a partner’s duty of loyalty is limited to: (2)(a) account to the partnership and hold as trustee for it any property, profit, or benefit derived .”
Yellowstone Valley Props. v. Eames (In re Eames), 108 B.R. 742 (Bankr. D. Mont. 1990). “Section 35-10-405(1), M.C.A. states: “Every partner must account to the partnership for any benefit and hold as trustee for it any profits derived by him without the consent of the other partners from any transaction connected with the formation, conduct, or liquidation of the…”
— Mont. Code Ann. § 35-10-405(2) — 4 cases
Phelps v. Frampton, 2007 MT 263 (Mont. 2007). “Frampton breached this fiduciary duty of loyalty by claiming and retaining an extraordinarily large sum as his sole property and refusing to pay Phelps his share.”
Baltrusch v. Baltrusch, 2003 MT 357 (Mont. 2003). “Section 35-10-405(1), MCA. Specifically, a partner’s duty of loyalty is limited to: (2)(a) account to the partnership and hold as trustee for it any property, profit, or benefit derived .”
Schwarz v. Liechti (In re Liechti), 543 B.R. 26 (Bankr. D. Mont. 2015). “• The Montana Supreme Court described, as “fiduciary duties,” a partner’s duties of loyalty and care to other partners under MCA §§ 35-10-405(2), (4), and in the discharge of partners’ duty to furnish complete and accurate information concerning a partnership (§ 35-10-403, MCA).”
Matter of: The Potter Exemption Trust, 2025 MT 231 (Mont. 2025). ““[T]he only fiduciary duties a partner owes to the partnership and the other partners are the duty of loyalty and the duty of care” as set forth in § 35-10-405, MCA. A partner’s duty of loyalty is to account and hold as trustee all partnership property and to avoid conflicts of…”
— Mont. Code Ann. § 35-10-405(2)(a) — 1 case
Jackpot Farms v. Johns Farms, 2020 MT 311 (Mont. 2020). “” Section 35-10- 405(6), MCA (stating further that “[a] partner may lend money to and transact other business with the partnership”).”
— Mont. Code Ann. § 35-10-405(2)(a)(ii) — 1 case
Baltrusch v. Baltrusch, 2003 MT 357 (Mont. 2003). “Section 35-10-405(1), MCA. Specifically, a partner’s duty of loyalty is limited to: (2)(a) account to the partnership and hold as trustee for it any property, profit, or benefit derived .”
— Mont. Code Ann. § 35-10-405(2)(a)(iii) — 1 case
Phelps v. Frampton, 2007 MT 263 (Mont. 2007). “Frampton breached this fiduciary duty of loyalty by claiming and retaining an extraordinarily large sum as his sole property and refusing to pay Phelps his share.”
— Mont. Code Ann. § 35-10-405(2)(b) — 1 case
McCormick v. Brevig, 2007 MT 195 (Mont. 2007). “Section 35-10-405(2)(b), MCA, imposes a duty of loyalty on a partner to refrain from dealing with the partnership as a party having an interest adverse to *385 the partnership, without the consent of the other partners.”
— Mont. Code Ann. § 35-10-405(5) — 4 cases
Phelps v. Frampton, 2007 MT 263 (Mont. 2007). “Frampton breached this fiduciary duty of loyalty by claiming and retaining an extraordinarily large sum as his sole property and refusing to pay Phelps his share.”
Baltrusch v. Baltrusch, 2006 MT 51 (Mont. 2006). “[3] See § 35-10-403, MCA (declaring a partner's duty to furnish complete and accurate information to another partner); § 35-10-405(5), MCA (declaring that a partner must discharge his duties consistent with the obligation of good faith and fair dealing).”
McCormick v. Brevig, 2007 MT 195 (Mont. 2007). “Section 35-10-405(2)(b), MCA, imposes a duty of loyalty on a partner to refrain from dealing with the partnership as a party having an interest adverse to *385 the partnership, without the consent of the other partners.”
Jackpot Farms v. Johns Farms, 2020 MT 311 (Mont. 2020). “” Section 35-10- 405(6), MCA (stating further that “[a] partner may lend money to and transact other business with the partnership”).”
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