15 Pa.C.S. Ch. 93

in effect

15 Pa.C.S. § 9301 Short title of chapter.

This chapter shall be known and may be cited as the Professional Association Act of 1988.

15 Pa.C.S. § 9302 Application of chapter.

(a) General rule.--This chapter shall apply to and the word "association" in this chapter shall mean a professional association organized under the act of August 7, 1961 (P.L.941, No.416), known as the Professional Association Act, which has not: (1) Reorganized as an electing partnership under Chapter 87 (relating to electing partnerships). (2) Elected to become a professional corporation in the manner provided by section 2905 (relating to election of professional associations to become professional corporations). (3) Converted to a limited liability company under Subchapter E of Chapter 3 (relating to conversion). (b) No new associations.--An association may not be originally organized under this chapter. (Dec. 7, 1994, P.L.703, No.106, eff. 60 days; Oct. 22, 2014, P.L.2640, No.172, eff. July 1, 2015; Nov. 21, 2016, P.L.1328, No.170, eff. 90 days) References in Text. The act of August 7, 1961, P.L.941, No.416, known as the Professional Association Act, referred to in subsec. (a), was repealed December 21, 1988, P.L.1444, No.177. Cross References. Section 9302 is referred to in section 102 of this title.

15 Pa.C.S. § 9303 Definitions.

The following words and phrases when used in this chapter shall have the meanings given to them in this section unless the context clearly indicates otherwise: "Associates." The members of any association. "Profession." Includes all occupations legally or traditionally designated as professions in which members by law (apart from Chapter 29 (relating to professional corporations)), tradition or ethics are forbidden to incorporate for the purpose of rendering professional services, including, but not limited to, architects, attorneys at law, certified public accountants, chiropractors, dentists, osteopaths, physicians and surgeons. "Professional service." Any type of service which can be rendered by the member of any profession within the purview of that profession.

15 Pa.C.S. § 9304 Purpose of association.

An association may be organized only for the purpose of rendering the one specific kind of professional service its associates are authorized to render, and it shall not engage in any business other than rendering the professional service for which it was organized. The professional services shall be rendered subject to rules and regulations of the professional licensing boards with particular reference to manner of practice, number of locations of practice and professional conduct as well as any other matter which may properly come within the jurisdiction of the professional licensing boards. However, it may invest its funds in real estate, mortgages, shares, bonds or any other type of investment, and it may own real and personal property necessary or appropriate for rendering its professional service.

15 Pa.C.S. § 9305 Articles of association.

(a) General rule.--The articles of association shall contain the name of the association, the names and addresses of all of the associates, the address of the principal office of the association and a general purpose clause of the association. One copy of the articles of association, fully executed, shall be filed with the office of the clerk of the court of common pleas of the county in which the association has its principal office. (b) Amended articles of association.--Amended articles of association shall be filed in the Department of State by the association within 30 days of any change in its membership or principal office address. (c) Statement of summary of record.--The association shall be subject to section 1311 (relating to filing of statement of summary of record by certain corporations) to the same extent as if it were a business corporation except that any subsistence certificate issued by the department thereunder shall state that the association is a professional association duly existing under the laws of this Commonwealth. (d) Cross reference.--See section 134 (relating to docketing statement).

15 Pa.C.S. § 9306 Board of governors.

The associates shall elect a board of governors which shall manage all of the affairs of the association. The membership of the board of governors shall consist of one or more persons who may but need not be associates. The board shall elect a chairman, a secretary, a treasurer and any other officers it deems necessary for the successful management of the association.

15 Pa.C.S. § 9307 Bylaws.

The associates shall adopt bylaws to regulate the affairs of the association. The bylaws shall provide for: (1) The method of election of the members of the board of governors. (2) The number of members of the board of governors. (3) The method of election of officers of the board of governors. (4) The dates of the regular meetings of the associates which shall occur at least once each year. (5) The dates of the regular meetings of the board of governors which shall occur at least once each year. (6) A method for determining the values of the respective interests of the associates. (7) The method of amending the bylaws. (8) The term of existence of the association. (9) Such other provisions as the associates may deem necessary for the successful regulation of the affairs of the association.

15 Pa.C.S. § 9308 Employees.

The board of governors may engage such employees as it deems necessary for the operation of the association. An employee shall not be engaged to render professional services unless he is duly licensed or otherwise legally authorized to render the professional services in this Commonwealth except that the association may engage agents or employees who are not duly licensed or otherwise legally authorized to render professional services to render services of a nonprofessional nature. An associate may be an employee of the association.

15 Pa.C.S. § 9309 Compensation.

The board of governors shall have the right to establish the amount and method of compensation of all of the employees.

15 Pa.C.S. § 9310 Distribution of excess earnings.

The board of governors may establish what portion of excess earnings of the association shall be distributed among the associates. Any distribution of excess earnings of the association shall be made to each associate according to his proportionate ownership in the association.

15 Pa.C.S. § 9311 Interests of associates.

The portion of ownership of each associate in an association shall be evidenced by an ownership certificate.

15 Pa.C.S. § 9312 Transfer of interests.

Any associate or the personal representative of his estate may transfer, in whole or in part, his interest in an association only to a transferee who is licensed or otherwise legally authorized to render the same kind of professional service which the association was organized to render. If any restrictions are imposed on the right to transfer, the restrictions shall be specifically set forth in the bylaws of the association, and reference to the restriction shall be set forth either generally or specifically on any certificates which evidence ownership in the association. Cross References. Section 9312 is referred to in section 9318 of this title.

15 Pa.C.S. § 9313 Redemption of interests.

An association may, upon agreement with any associate (including any associate who has been expelled) or the personal representative of his estate, redeem the interest in the association of the associate or his estate.

15 Pa.C.S. § 9314 Term of existence.

An association may be organized for any term of years or its existence may be perpetual. Neither death, bankruptcy, resignation, expulsion, insanity, retirement nor transfer or redemption of the interest of any associate shall cause its dissolution.

15 Pa.C.S. § 9315 Name.

The associates may adopt any name for their association which is not contrary to law or the ethics of their profession.

15 Pa.C.S. § 9316 Voting of associates.

At any meeting of the associates of an association, each associate shall have the right to vote according to his proportionate ownership in the association.

15 Pa.C.S. § 9317 Liability of associates.

(a) Joint and several liability.--All of the associates of an association are liable, jointly and severally, for: (1) The torts of any agent or employee of the association committed while the agent or employee is acting within the ordinary course of operation of the association. (2) The misapplication by any associate of any money or property of a third person if the money or property was received by the association in the ordinary course of its operation. (b) Joint liability.--All of the associates of an association are liable, jointly, for all debts and legal obligations of the association other than those chargeable under subsection (a).

15 Pa.C.S. § 9318 Professional disqualifications.

If any agent or employee of the association engaged for the purpose of rendering professional services or any associate becomes legally disqualified to render professional services, the agency or employment shall be immediately terminated upon disqualification and, in the case of an associate, the associate shall be immediately expelled from the association. The expelled associate shall have the right to transfer his interest in the association in accordance with section 9312 (relating to transfer of interests).

15 Pa.C.S. § 9319 Dissolution.

(a) General rule.--An association shall be dissolved only upon the occurrence of one of the following: (1) Expiration of the term of existence as provided in the bylaws of the association but not until articles of dissolution have been filed as provided in subsection (c). (2) Upon vote of a majority (or such percentage as may be provided in the bylaws but in no event less than a simple majority) of the associates, voting according to their proportionate shares of ownership, to dissolve prior to the expiration of the term of existence of the association. (b) Procedure.--If a special meeting is called for the purpose of voting to dissolve an association, notice shall be given to each of the associates at his address of record with the association of the time, place and purpose of the meeting, by first class mail, at least ten days prior to the meeting unless a greater period is required by the bylaws. (c) Articles of dissolution.--The association shall file articles of dissolution substantially as provided by section 1977 (relating to articles of dissolution). (d) Effect of dissolution.--Upon dissolution, all debts and obligations of the association shall be satisfied and, if any property of the association remains, it shall be divided among the associates proportionally according to their ownership in the association. If all of the debts and legal obligations of the association have not been satisfied at the time of dissolution, all of the associates shall remain jointly and severally liable until all the debts and obligations are satisfied.

Source: Open US Law by Vaquill AI (CC BY 4.0)URL: https://www.palegis.us/statutes/consolidated/view-statute?txtType=HTM&ttl=15Fetched: 10/16/2026