§ 69 — Rights of partners to application of partnership property 1

New York § 69

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

Text

§ 69. Rights of partners to application of partnership property 1.\nWhen dissolution is caused in any way, except in contravention of the\npartnership agreement, each partner, as against his copartners and all\npersons claiming through them in respect of their interests in the\npartnership, unless otherwise agreed, may have the partnership property\napplied to discharge its liabilities, and the surplus applied to pay in\ncash the net amount owing to the respective partners. But if dissolution\nis caused by expulsion of a partner, bona fide under the partnership\nagreement, and if the expelled partner is discharged from all\npartnership liabilities, either by payment or agreement under section\nsixty-seven, subdivision two, he shall receive in cash only the net\namount due him from the partnership.\n 2. When dissolution is caused in contravention of the partnership\nagreement the rights of the partners shall be as follows:\n (a) Each partner who has not caused dissolution wrongfully shall have,\n (I) All the rights specified in subdivision one of this section, and\n (II) The right, as against each partner who has caused the dissolution\nwrongfully, to damages for breach of the agreement.\n (b) The partners who have not caused the dissolution wrongfully, if\nthey all desire to continue the business in the same name, either by\nthemselves or jointly with others, may do so, during the agreed term for\nthe partnership and for that purpose may possess the partnership\nproperty, provided they secure the payment by bond approved by the\ncourt, or pay to any partner who has caused the dissolution wrongfully,\nthe value of his interest in the partnership at the dissolution, less\nany damages recoverable under clause (II) of paragraph (a) of\nsubdivision two of this section, and in like manner indemnify him\nagainst all present or future partnership liabilities.\n (c) A partner who has caused the dissolution wrongfully shall have:\n (I) If the business is not continued under the provisions of paragraph\n(b) of subdivision two of this section all the rights of a partner under\nsubdivision (1), subject to clause (II) of paragraph (a) of subdivision\ntwo, of this section.\n (II) If the business is continued under paragraph (b) of subdivision\ntwo of this section the right as against his copartners and all claiming\nthrough them in respect of their interest in the partnership, to have\nthe value of his interest in the partnership, less any damages caused to\nhis copartners by the dissolution, ascertained and paid to him in cash,\nor the payment secured by bond approved by the court, and to be released\nfrom all existing liabilities of the partnership; but in ascertaining\nthe value of the partner's interest the value of the good-will of the\nbusiness shall not be considered.\n