§ 45-10.2-105 — (1111) Liability of general partner after conversion or merger

North Dakota § 45-10.2-105

• Jurisdiction: North Dakota
• Title 45: Partnerships
• Ch. 45-10.2: Uniform Limited Partnership Act

Text

1. A conversion or merger under this chapter does not discharge any liability under
sections 45-10.2-40 and 45-10.2-61 of a person that was a general partner in or
dissociated as a general partner from a converting or constituent limited partnership,
but:
a. The provisions of this chapter pertaining to the collection or discharge of the
liability continue to apply to the liability;
b. For the purposes of applying those provisions, the converted or surviving
organization is deemed to be the converting or constituent limited partnership;
and
c. If a person is required to pay any amount under this subsection, then:
(1) The person has a right of contribution from each other person that was liable
as a general partner under section 45-10.2-40 when the obligation was
incurred and has not been released from the obligation under section
45-10.2-61; and
(2) The contribution due from each of those persons is in proportion to the right
to receive distributions in the capacity of general partner in effect for each of
those persons when the obligations were incurred.
2. In addition to any other liability provided by law:
a. A person that immediately before a conversion or merger became effective was a
general partner in a converting or constituent limited partnership that was not a
limited liability limited partnership is personally liable for each obligation of the
converted or surviving organization arising from a transaction with a third party

after the conversion or merger becomes effective, if, at the time the third party
enters into the transaction, the third party:
(1) Does not have notice of the conversion or merger; and
(2) Reasonably believes that:
(a) The converted or surviving organization or business is the converting
or constituent limited partnership;
(b) The converting or constituent limited partnership is not a limited
liability limited partnership; and
(c) The person is a general partner in the converting or constituent limited
partnership; and
b. A person that was dissociated as a general partner from a converting or
constituent limited partnership before the conversion or merger became effective
is personally liable for each obligation of the converted or surviving organization
arising from a transaction with a third party after the conversion or merger
becomes effective, if:
(1) Immediately before the conversion or merger became effective the
converting or surviving limited partnership was not a limited liability limited
partnership; and
(2) At the time the third party enters into the transaction less than two years
have passed since the person dissociated as a general partner and the third
party:
(a) Does not have notice of the dissociation;
(b) Does not have notice of the conversion or merger; and
(c) Reasonably believes that:
[1] The converted or surviving organization or business is the
converting or constituent limited partnership;
[2] The converting or constituent limited partnership is not a limited
liability limited partnership; and
[3] The person is a general partner in the converting or constituent
limited partnership.
45-10.2-106. (1112) Power of general partners and persons dissociated as general
partners to bind organization after conversion or merger.
1. An act of a person that immediately before a conversion or merger became effective
was a general partner in a converting or constituent limited partnership binds the
converted or surviving organization after the conversion or merger becomes effective,
if:
a. Before the conversion or merger became effective, the act would have bound the
converting or constituent limited partnership under section 45-10.2-38; and
b. At the time the third party enters into the transaction, the third party:
(1) Does not have notice of the conversion or merger; and
(2) Reasonably believes that:
(a) The converted or surviving organization or business is the converting
or constituent limited partnership; and
(b) The person is a general partner in the converting or constituent limited
partnership.
2. An act of a person that before a conversion or merger became effective was
dissociated as a general partner from a converting or constituent limited partnership
binds the converted or surviving organization after the conversion or merger becomes
effective, if:
a. Before the conversion or merger became effective, the act would have bound the
converting or constituent limited partnership under section 45-10.2-38 if the
person had been a general partner; and
b. At the time the third party enters into the transaction, less than two years have
passed since the person dissociated as a general partner and the third party:
(1) Does not have notice of the dissociation;

(2) Does not have notice of the conversion or merger; and
(3) Reasonably believes that:
(a) The converted or surviving organization or business is the converting
or constituent limited partnership; and
(b) The person is a general partner in the converting or constituent limited
partnership.
3. If a person having knowledge of the conversion or merger causes a converted or
surviving organization to incur an obligation under subsection 1 or 2, then the person
is liable:
a. To the converted or surviving organization for any damage caused to the
organization arising from the obligation; and
b. If another person is liable for the obligation, then to that other person for any
damage caused to that other person arising from the liability.