Del. Reaffirms Freedom To Contract Out Of Fiduciary Duties
August 13, 2013, 2:19 PM EDT
Law360, New York (August 13, 2013, 2:19 PM EDT) -- In the latest in a series of fiduciary duty cases challenging the contractual “special approval” process provided in the limited partnership agreements of master limited partnerships (MLPs), the Delaware Supreme Court recently affirmed that limited partnerships may eliminate fiduciary duties in their partnership agreements, with the exception of the implied contractual covenant of good faith and fair dealing, which may not be eliminated.
The court’s decision supports the proposition that carefully drafted “special approval” provisions in limited partnership agreements may be used as a mechanism to...