Conclusive Presumption of Good Faith in MLP Agreements
July 3, 2013
The Delaware Supreme Court provided helpful guidance on the operation of the conclusive presumption of good faith in master limited partnership agreements in three recent decisions: Brinckerhoff v. Enbridge Energy, No. 574, 2011 (Del. May 28, 2013); Norton v. K-Sea Transportation Partners L.P., No. 238, 2012 (Del. May 28, 2013); and Gerber v. Enterprise Products Holdings LLC, No. 46, 2012 (Del. June 10, 2013). These decisions validate the use of conclusive presumption provisions in accordance with the intent of the Delaware Revised Uniform Limited Partnership Act (DRULPA) to give “maximum effect to the principle of freedom of contract and to the enforceability of partnership agreements,” yet demonstrate that such contractual freedom is not without limits.