SB566: Bill Text

SB566,132,6 (c) At the time the other party enters into the transaction, the other party does not have knowledge or notice of the dissociation and reasonably believes that the person is a general partner.

SB566,132,9 (4) By agreement with a creditor of a limited partnership and the partnership, a person dissociated as a general partner may be released from liability for a debt, obligation, or other liability of the partnership to the creditor.

SB566,132,14 (5) A person dissociated as a general partner is released from liability for a debt, obligation, or other liability of the limited partnership if the partnership's creditor, with knowledge or notice of the person's dissociation as a general partner but without the person's consent, agrees to a material alteration in the nature or time of payment of the debt, obligation, or other liability.

SB566,132,15 subchapter VII

SB566,132,18 TRANSFERABLE INTERESTS AND RIGHTS OF TRANSFEREES AND CREDITORS

SB566,132,20 179.0701 Nature of transferable interest. A transferable interest is personal property.

SB566,132,22 179.0702 Transfer of transferable interest. (1) All of the following apply to a transfer, in whole or in part, of a transferable interest:

SB566,132,23 (a) It is permissible.

SB566,132,25 (b) It does not by itself cause a partner's dissociation or a dissolution and winding up of the limited partnership's activities and affairs.

SB566,133,2 (c) Subject to s. 179.0704, it does not entitle the transferee to do any of the following:

SB566,133,4 1. Participate in the management or conduct of the partnership's activities and affairs.

SB566,133,6 2. Except as otherwise provided in sub. (3), have access to required information, records, or other information concerning the partnership's activities and affairs.

SB566,133,8 (2) A transferee has the right to receive, in accordance with the transfer, distributions to which the transferor would otherwise be entitled.

SB566,133,11 (3) In a dissolution and winding up of a limited partnership, a transferee is entitled to an account of the partnership's transactions only from the date of dissolution.

SB566,133,14 (4) A transferable interest may be evidenced by a certificate of the interest issued by a limited partnership in a record, and, subject to this section, the interest represented by the certificate may be transferred by a transfer of the certificate.

SB566,133,16 (5) A limited partnership need not give effect to a transferee's rights under this section until the partnership knows or has notice of the transfer.

SB566,133,19 (6) A transfer of a transferable interest in violation of a valid restriction on transfer contained in the partnership agreement is ineffective if the intended transferee has knowledge or notice of the restriction at the time of transfer.

SB566,133,23 (7) Except as otherwise provided in ss. 179.0601 (2) (d) 2. and 179.0603 (4) (b), if a general or limited partner transfers a transferable interest, the transferor retains the rights of a general or limited partner other than the transferable interest transferred and retains all the duties and obligations of a general or limited partner.

SB566,134,2 (8) If a general or limited partner transfers a transferable interest to a person that becomes a general or limited partner with respect to the transferred interest, the transferee is liable for the transferor's obligations under ss. 179.0502 and 179.0505 known to the transferee when the transferee becomes a partner.

SB566,134,8 179.0703 Charging order. (1) On application by a judgment creditor of a partner or transferee, a court may enter a charging order against the transferable interest of the judgment debtor for the unsatisfied amount of the judgment. A charging order constitutes a lien on a judgment debtor's transferable interest and requires the limited partnership to pay over to the person to which the charging order was issued any distribution that otherwise would be paid to the judgment debtor.

SB566,134,10 (2) To the extent necessary to effectuate the collection of distributions pursuant to a charging order in effect under sub. (1), the court may do any of the following:

SB566,134,12 (a) Appoint a receiver of the distributions subject to the charging order, with the power to make all inquiries the judgment debtor might have made.

SB566,134,13 (b) Make all other orders necessary to give effect to the charging order.

SB566,134,18 (3) Upon a showing that distributions under a charging order will not pay the judgment debt within a reasonable time, the court may foreclose the lien and order the sale of the transferable interest. The purchaser at the foreclosure sale obtains only the transferable interest, does not thereby become a partner, and is subject to s. 179.0702.

SB566,134,22 (4) At any time before foreclosure under sub. (3), the partner or transferee whose transferable interest is subject to a charging order under sub. (1) may extinguish the charging order by satisfying the judgment and filing a certified copy of the satisfaction with the court that issued the charging order.

SB566,135,2 (5) At any time before foreclosure under sub. (3), a limited partnership or one or more partners whose transferable interests are not subject to the charging order may pay to the judgment creditor the full amount due under the judgment and thereby succeed to the rights of the judgment creditor, including the charging order.

SB566,135,4 (6) This chapter does not deprive any partner or transferee of the benefit of any exemption law applicable to the transferable interest of the partner or transferee.

SB566,135,8 (7) This section provides the exclusive remedy by which a person seeking, in the capacity of a judgment creditor, to enforce a judgment against a partner or transferee may satisfy the judgment from the judgment debtor's transferable interest.

SB566,135,10 179.0704 Power of legal representative of deceased partner. If a partner dies, the deceased partner's legal representative may exercise any of the following:

SB566,135,11 (1) The rights of a transferee provided in s. 179.0702 (3).

SB566,135,13 (2) For purposes of settling the estate, the rights of a current limited partner under s. 179.0304.

SB566,135,14 subchapter VIII

SB566,135,15 DISSOLUTION AND WINDING UP

SB566,135,18 179.0801 Events causing dissolution. (1) A limited partnership is dissolved, and its activities and affairs must be wound up, upon the occurrence of any of the following:

SB566,135,20 (a) An event or circumstance that the partnership agreement states causes dissolution.

SB566,135,24 (b) The affirmative vote or consent to dissolve of all general partners and of limited partners owning a majority of the rights to receive distributions, whether as a general partner, a limited partner, or both, at the time the vote or consent is to be effective.

SB566,136,2 (c) After the dissociation of a person as a general partner if any of the following applies:

SB566,136,7 1. If the partnership has at least one remaining general partner, the affirmative vote or consent to dissolve the partnership not later than 90 days after the dissociation by partners owning a majority of the rights to receive distributions, whether as a general partner, a limited partner, or both, at the time the vote or consent is to be effective.

SB566,136,10 2. If the partnership does not have a remaining general partner, the passage of 90 days after the dissociation unless, before the end of the period, all of the following occur:

SB566,136,14 a. Consent to continue the activities and affairs of the partnership and admit at least one general partner is given by limited partners owning a majority of the rights to receive distributions as limited partners at the time the consent is to be effective.

SB566,136,16 b. At least one person is admitted as a general partner in accordance with the consent.

SB566,136,19 (d) The passage of 90 consecutive days after the dissociation of the partnership's last limited partner unless, before the end of the period, the partnership admits at least one limited partner.

SB566,136,21 (e) The passage of 90 consecutive days during which the partnership has only one partner unless, before the end of the period, all of the following are satisfied:

SB566,136,22 1. The partnership admits at least one person as a partner.

SB566,136,24 2. If the previously sole remaining partner is only a general partner, the partnership admits the person as a limited partner.

SB566,137,2 3. If the previously sole remaining partner is only a limited partner, the partnership admits a person as a general partner.

SB566,137,4 (f) On application by a partner, the entry by the circuit court of an order dissolving the partnership on any of the following grounds:

SB566,137,6 1. That the conduct of all or substantially all the partnership's activities and affairs is unlawful.

SB566,137,9 2. That it is not reasonably practicable to carry on the partnership's activities and affairs in conformity with the certificate of limited partnership and partnership agreement.

SB566,137,11 (g) The signing and filing of a notice of administrative dissolution by the department under s. 179.0811.

SB566,137,15 (2) If an event occurs that imposes a deadline on a limited partnership under sub. (1) and, before the partnership has met the requirements of the deadline, another event occurs that imposes a different deadline on the partnership under sub. (1), all of the following apply:

SB566,137,17 (a) The occurrence of the second event does not affect the deadline caused by the first event.

SB566,137,19 (b) The partnership's meeting of the requirements of the first deadline does not extend the second deadline.

SB566,137,22 179.0802 Winding up. (1) A dissolved limited partnership shall wind up its activities and affairs and, except as otherwise provided in s. 179.0803, the partnership continues after dissolution only for the purpose of winding up.

SB566,138,2 (2) (a) In winding up its activities and affairs, a limited partnership shall discharge the partnership's debts, obligations, and other liabilities, settle and close the partnership's activities and affairs, and marshal and distribute the assets of the partnership.

SB566,138,4 (b) In winding up its activities and affairs, a limited partnership may do any of the following:

SB566,138,6 1. Amend its certificate of limited partnership to state that the partnership is dissolved.

SB566,138,8 2. Preserve the partnership's activities and affairs and property as a going concern for a reasonable time.

SB566,138,10 3. Prosecute and defend actions and proceedings, whether civil, criminal, or administrative.

SB566,138,11 4. Transfer the partnership's property.

SB566,138,12 5. Settle disputes by mediation or arbitration.

SB566,138,14 6. Deliver to the department for filing a statement of termination stating the name of the partnership and that the partnership is terminated.

SB566,138,15 7. Perform other acts necessary or appropriate to the winding up.

SB566,138,20 (3) If a dissolved limited partnership does not have a general partner, a person to wind up the dissolved partnership's activities and affairs may be appointed by the affirmative vote or consent of limited partners owning a majority of the rights to receive distributions as limited partners at the time the vote or consent is to be effective. All of the following apply to a person appointed under this subsection:

SB566,138,24 (a) The person has the powers of a general partner under s. 179.0804 but is not liable for the debts, obligations, and other liabilities of the partnership solely by reason of having or exercising those powers or otherwise acting to wind up the dissolved partnership's activities and affairs.

SB566,139,3 (b) The person shall deliver promptly to the department for filing an amendment to the partnership's certificate of limited partnership stating all of the following:

SB566,139,4 1. That the partnership does not have a general partner.

SB566,139,5 2. The name and street and mailing addresses of the person.

SB566,139,7 3. That the person has been appointed pursuant to this subsection to wind up the partnership.

SB566,139,11 (4) On the application of a partner, the circuit court may order judicial supervision of the winding up of a dissolved limited partnership, including the appointment of a person to wind up the partnership's activities and affairs, if any of the following applies:

SB566,139,13 (a) The partnership does not have a general partner and within a reasonable time following the dissolution no person has been appointed pursuant to sub. (3).

SB566,139,14 (b) The applicant establishes other good cause.

SB566,139,19 179.0803 Rescinding dissolution. (1) A limited partnership may rescind its dissolution, unless a statement of termination applicable to the partnership has become effective, the circuit court has entered an order under s. 179.0801 (1) (f) dissolving the partnership, or the department has dissolved the partnership under s. 179.0811.

SB566,139,20 (2) Rescinding dissolution under this section requires all of the following:

SB566,139,21 (a) The affirmative vote or consent of each partner.

SB566,139,24 (b) If the limited partnership has delivered to the department for filing an amendment to the certificate of limited partnership stating that the partnership is dissolved, delivery to the department for filing of one of the following:

SB566,140,2 1. If the amendment has not become effective, a statement of withdrawal under s. 179.0208 applicable to the amendment.

SB566,140,4 2. If the amendment has become effective, an amendment to the certificate of limited partnership stating that dissolution has been rescinded under this section.

SB566,140,5 (3) If a limited partnership rescinds its dissolution, all of the following apply:

SB566,140,7 (a) Subject to par. (c), the partnership resumes carrying on its activities and affairs as if dissolution had never occurred.

SB566,140,9 (b) Subject to par. (c), the rescission relates back to and takes effect as of the effective date of the dissolution.

SB566,140,12 (c) The rights of a person arising out of an act or omission in reliance on the dissolution before the person knew or had notice of the rescission are not adversely affected.

SB566,140,15 179.0804 Power to bind partnership after dissolution. (1) A limited partnership is bound by a general partner's act with respect to a transaction with another party after dissolution if any of the following applies:

SB566,140,19 (a) The act is appropriate for winding up the partnership's activities and affairs, unless the partner did not have authority to act for the partnership in the particular matter and the party with which the partner was dealing knew or had notice that the partner lacked authority.

SB566,140,22 (b) The act would have bound the partnership under s. 179.0402 before dissolution if, at the time the other party enters into the transaction, the other party does not know or have notice of the dissolution.

SB566,140,25 (2) A person dissociated as a general partner binds a limited partnership with respect to a transaction with another party through an act occurring after dissolution if all of the following apply:

SB566,141,2 (a) At the time the other party enters into the transaction, less than 2 years has passed since the dissociation.

SB566,141,5 (b) At the time the other party enters into the transaction, the other party does not know or have notice of the dissociation and reasonably believes that the person is a general partner.

SB566,141,9 (c) The act is appropriate for winding up the partnership's activities and affairs, or the act would have bound the partnership under s. 179.0402 before dissolution and at the time the other party enters into the transaction the other party does not know or have notice of the dissolution.