RNR Investments Limited Partnership v. People’s First Community Bank
District Court of Appeal of Florida, First District
812 So.2d 561 (2002)
RNR Investments Limited Partnership (RNR) (defendant) restricted general partner Bernard Roeger's authority in its written partnership agreement, requiring the limited partners' written consent before exceeding any approved budget line by more than 10 percent. Roeger got approval to seek $650,000 in construction financing but, without telling the limited partners, signed a loan and mortgage with People's First Community Bank (Bank) (plaintiff) for $990,000, and the Bank had no knowledge of the agreement's internal restrictions. When RNR defaulted, the Bank sued to foreclose, and the trial court granted the Bank summary judgment, rejecting RNR's argument that the Bank had a duty to investigate Roeger's actual authority.
Whether a partner can bind the partnership in the ordinary course of business when the partner lacks actual authority but the third party has no actual knowledge of that limitation.