§ 66 — Power of partner to bind partnership to third persons after dissolution

New York § 66

• Jurisdiction: New York
• Law PTR: Partnership
• Art. 6: Dissolution and Winding Up

Text

§ 66. Power of partner to bind partnership to third persons after\ndissolution. (1) After dissolution a partner can bind the partnership\nexcept as provided in subdivision three\n (a) By any act appropriate for winding up partnership affairs or\ncompleting transactions unfinished at dissolution;\n (b) By any transaction which would bind the partnership if dissolution\nhad not taken place, provided the other party to the transaction\n (I) Had extended credit to the partnership prior to dissolution and\nhad no knowledge or notice of the dissolution; or\n (II) Though he had not so extended credit, had nevertheless known of\nthe partnership prior to the dissolution, and, having no knowledge or\nnotice of dissolution, the fact of dissolution had not been advertised\nin a newspaper of general circulation in the place (or in each place if\nmore than one) at which the partnership business was regularly carried\non.\n 2. The liability of a partner under subdivision one, paragraph (b),\nshall be satisfied out of partnership assets alone when such partner had\nbeen prior to dissolution\n (a) Unknown as a partner to the person with whom the contract is made;\nand\n (b) So far unknown and inactive in partnership affairs that the\nbusiness reputation of the partnership could not be said to have been in\nany degree due to his connection with it.\n 3. The partnership is in no case bound by any act of a partner after\ndissolution\n (a) Where the partnership is dissolved because it is unlawful to carry\non the business, unless the act is appropriate for winding up partnerhip\naffairs; or\n (b) Where the partner has become bankrupt; or\n (c) Where the partner has no authority to wind up partnership affairs,\nexcept by a transaction with one who\n (I) Had extended credit to the partnership prior to dissolution and\nhad no knowledge or notice of his want of authority; or\n (II) Had not extended credit to the partnership prior to dissolution,\nand, having no knowledge or notice of his want of authority, the fact of\nhis want of authority has not been advertised in the manner provided for\nadvertising the fact of dissolution in subdivision one, paragraph (b),\nclause (II).\n 4. Nothing in this section shall affect the liability under section\ntwenty-seven of any person who after dissolution represents himself or\nconsents to another representing him as a partner in a partnership\nengaged in carrying on business.\n