Title 23, Corporations And Partnerships

[§425E-305] Limited duties of limited partners. (a) A limited partner shall not have any fiduciary duty to the limited partnership or to any other partner solely by reason of being a limited partner. (b) A limited partner shall discharge the duties to the partnership and the othe…

[§425E-306] Person erroneously believing self to be a limited partner. (a) Except as otherwise provided in subsection (b), a person that makes an investment in a business enterprise and erroneously but in good faith believes that the person has become a limited partner in the ent…

ARTICLE 4. GENERAL PARTNERS [§425E-401] General partner. A person becomes a general partner: (1) As provided in the partnership agreement; (2) Under section 425E-801(3)(B) following the dissociation of a limited partnership's last general partner; (3) As the result of a conversio…

[§425E-402] General partner is an agent of the limited partnership. (a) Each general partner shall be an agent of the limited partnership for the purposes of its activities. An act of a general partner, including the signing of a record in the partnership's name, for apparently c…

[§425E-403] Limited partnership liable for general partner's actionable conduct. (a) A limited partnership shall be liable for loss or injury caused to a person, or for a penalty incurred, as a result of a wrongful act or omission or other actionable conduct of a general partner …

[§425E-404] General partner's liability. (a) Except as otherwise provided in subsections (b) and (c), all general partners are liable jointly and severally for all obligations of the limited partnership unless otherwise agreed by the claimant or provided by law. (b) A person that…

[§425E-405] Actions by and against partnership and partners. (a) To the extent not inconsistent with section 425E-404, a general partner may be joined in an action against the limited partnership or named in a separate action. (b) A judgment against a limited partnership is not b…

[§425E-406] Management rights of general partners. (a) Each general partner has equal rights in the management and conduct of the limited partnership's activities. Except as expressly provided in this chapter, any matter relating to the activities of the limited partnership may b…

§425E-407 Right of general partner and former general partner to information. (a) A general partner, without having any particular purpose for seeking the information, may inspect and copy during regular business hours: (1) In the limited partnership's principal office, required …

[§425E-408] General standards of a general partner's conduct. (a) The only fiduciary duties that a general partner has to the limited partnership and the other partners are the duties of loyalty and care under subsections (b) and (c). (b) A general partner's duty of loyalty to th…

ARTICLE 5. CONTRIBUTIONS AND DISTRIBUTIONS [§425E-501] Form of contribution. A contribution of a partner may consist of tangible or intangible property or other benefit to the limited partnership, including money, services performed, promissory notes, other agreements to contribu…

[§425E-502] Liability for contribution. (a) A partner's obligation to contribute money or other property or other benefit to, or to perform services for, a limited partnership shall not be excused by the partner's death, disability, or other inability to perform personally. (b) I…

[§425E-503] Sharing of distributions. A distribution by a limited partnership shall be shared among the partners on the basis of the value, as stated in the required records when the limited partnership decides to make the distribution, of the contributions the limited partnershi…

[§425E-504] Interim distributions. A partner shall not have a right to any distribution before the dissolution and winding up of the limited partnership unless the limited partnership decides to make an interim distribution. [L 2003, c 210, pt of §1]

[§425E-505] No distribution on account of dissociation. A person shall not have a right to receive a distribution on account of dissociation. [L 2003, c 210, pt of §1]

[§425E-506] Distribution in kind. A partner shall not have a right to demand or receive any distribution from a limited partnership in any form other than cash. Subject to section 425E-812(b), a limited partnership may distribute an asset in kind to the extent each partner receiv…

[§425E-507] Right to distribution. When a partner or transferee becomes entitled to receive a distribution, the partner or transferee has the status of, and is entitled to all remedies available to, a creditor of the limited partnership with respect to the distribution. However, …

[§425E-508] Limitations on distribution. (a) A limited partnership may not make a distribution in violation of the partnership agreement. (b) A limited partnership may not make a distribution if after the distribution: (1) The limited partnership would not be able to pay its debt…

[§425E-509] Liability for improper distributions. (a) A general partner that consents to a distribution made in violation of section 425E-508 shall be personally liable to the limited partnership for the amount of the distribution which exceeds the amount that could have been dis…

ARTICLE 6. DISSOCIATION [§425E-601] Dissociation as a limited partner. (a) A person shall not have a right to dissociate as a limited partner before the termination of the limited partnership. (b) A person shall be dissociated from a limited partnership as a limited partner upon …

[§425E-602] Effect of dissociation as a limited partner. (a) Upon a person's dissociation as a limited partner: (1) Subject to section 425E-704, the person shall not have further rights as a limited partner; (2) The person's obligation of good faith and fair dealing as a limited …

[§425E-603] Dissociation as a general partner. A person shall be dissociated from a limited partnership as a general partner upon the occurrence of any of the following events: (1) The limited partnership's having notice of the person's express will to withdraw as a general partn…

[§425E-604] Person's power to dissociate as a general partner; wrongful dissociation. (a) A person has the power to dissociate as a general partner at any time, rightfully or wrongfully, by express will pursuant to section 425E-603(1). (b) A person's dissociation as a general par…

[§425E-605] Effect of dissociation as a general partner. (a) Upon a person's dissociation as a general partner: (1) The person's right to participate as a general partner in the management and conduct of the partnership's activities terminates; (2) The person's duty of loyalty as…

[§425E-606] Power to bind, and liability to, limited partnership before dissolution of partnership of a person dissociated as general partner. (a) After a person is dissociated as a general partner and before the limited partnership is dissolved, converted under article 11, or me…

[§425E-607] Liability to other persons of person dissociated as a general partner. (a) A person's dissociation as a general partner shall not of itself discharge the person's liability as a general partner for an obligation of the limited partnership incurred before dissociation.…

ARTICLE 7. TRANSFERABLE INTERESTS AND RIGHTS OF TRANSFEREES AND CREDITORS [§425E-701] Partner's transferable interest. The only interest of a partner which shall be transferable is the partner's transferable interest. A transferable interest shall be personal property. [L 2003, c…

[§425E-702] Transfer of partner's transferable interest. (a) A transfer, in whole or in part, of a partner's transferable interest: (1) Is permissible; (2) Shall not by itself cause the partner's dissociation or a dissolution and winding up of the limited partnership's activities…

[§425E-703] Rights of creditors of partners or transferees. (a) On application to a court of competent jurisdiction by any judgment creditor of a partner or transferee, the court may charge the transferable interest of the judgment debtor with payment of the unsatisfied amount of…

[§425E-704] Power of estate of deceased partner. If a partner dies, the deceased partner's personal representative or other legal representative may exercise the rights of a transferee as provided in section 425E-702 and, for the purposes of settling the estate, may exercise the …

ARTICLE 8. DISSOLUTION §425E-801 Nonjudicial dissolution. Except as otherwise provided in section 425E-802, a limited partnership shall be dissolved, and its activities shall be wound up, only upon the occurrence of any of the following: (1) The happening of an event specified in…

[§425E-802] Judicial dissolution. On application by a partner, the circuit court may order dissolution of a limited partnership if it is not reasonably practicable to carry on the activities of the limited partnership in conformity with the partnership agreement. [L 2003, c 210, …

[§425E-803] Winding up. (a) A limited partnership continues after dissolution only for the purpose of winding up its activities. (b) In winding up its activities, the limited partnership: (1) May amend its certificate of limited partnership to state that the limited partnership i…

[§425E-804] Power of general partner and person dissociated as general partner to bind partnership after dissolution. (a) A limited partnership shall be bound by a general partner's act after dissolution that: (1) Is appropriate for winding up the limited partnership's activities…

[§425E-805] Liability after dissolution of general partner and person dissociated as general partner to limited partnership, other general partners, and persons dissociated as general partners. (a) If a general partner having knowledge of the dissolution causes a limited partners…

[§425E-806] Known claims against dissolved limited partnership. (a) A dissolved limited partnership may dispose of the known claims against it by following the procedure described in subsection (b). (b) A dissolved limited partnership may notify its known claimants of the dissolu…

§425E-807 Other claims against dissolved limited partnership. (a) A dissolved limited partnership may publish notice of its dissolution and request persons having claims against the limited partnership to present them in accordance with the notice. (b) The notice shall: (1) Be pu…

[§425E-808] Liability of general partner and person dissociated as general partner when claim against limited partnership barred. If a claim against a dissolved limited partnership is barred under section 425E-806 or 425E-807, any corresponding claim under section 425E-404 shall …

§425E-809 Administrative cancellation. (a) The director may cancel the certificate of a limited partnership administratively if the partnership fails to: (1) Pay any fees prescribed by law; (2) File its annual statement for a period of two years; (3) Appoint and maintain an agent…

§425E-810 Reinstatement following administrative cancellation. (a) A limited partnership that has been administratively canceled may apply to the director for reinstatement within two years after the effective date of cancellation. The application shall: (1) Recite the name of th…

§425E-811 Appeal from denial of reinstatement. (a) If the director denies a limited partnership's application for reinstatement following administrative cancellation, the director shall notify the limited partnership of the reason or reasons for the denial. (b) The limited partne…

[§425E-812] Disposition of assets; when contributions required. (a) In winding up a limited partnership's activities, the assets of the limited partnership, including the contributions required by this section, shall be applied to satisfy the limited partnership's obligations to …

ARTICLE 9. FOREIGN LIMITED PARTNERSHIPS §425E-901 Governing law. (a) Subject to the constitution of this State: (1) The laws of the state under which a foreign limited partnership is organized govern its organization and internal affairs and the liability of its partners; and (2)…

§425E-902 Application for certificate of authority. (a) A foreign limited partnership may apply for a certificate of authority to transact business in this State by delivering an application to the director for filing. The application shall state: (1) The name of the foreign limi…

[§425E-903] Activities not constituting transacting business. (a) Activities of a foreign limited partnership that do not constitute transacting business in this State within the meaning of this article include: (1) Maintaining, defending, and settling an action or proceeding; (2…

[§425E-904] Issuance of certificate of authority. (a) If the director finds that an application for registration conforms to law and all requisite fees have been paid, the director shall issue a certificate of authority to transact business in this State. (b) The certificate of a…