General Partnership Dissolution

Question 1

What is dissolution?

Answer 1

In the absence of an agreement that sets forth events of dissolution, a general partnership dissolves upon NOTICE of the EXPRESS WILL of any general partner to DISSOCIATE.

Question 2

the real end of the partnership is called

Answer 2

termination

Question 3

what is winding up?

Answer 3

the period between dissolution and termination in which the remaining partners liquidate the partnership’s assets to satisfy the partnership’s creditor.

Question 4

When a partnership dissolves, what do the partners retain liability on?

Answer 4

The partnership and therefore its individual general partners retain liability on all transactions entered into to wind up old business by satisfying creditors who existed before winding up began.

Question 5

What new business are the partners liable for?

Answer 5

The partnership and therefore its individual general partners retain liability until actual notice of dissolution is given to creditors or until 90 days after filing a statement of dissolution with the statement.

Question 6

What is the priority of distribution when a partnership dissolves?

Answer 6

1. first, Pship must pay ALL creditors.

creditors include all outside non-partner trade creditors + all partners who have loaned money to the partnership and become creditors thereby.

2. partnerships must repay all capital contributions paid into the partnership by partners.
3. profits, if any, w/o an agreement, are shared equally among partners.