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45-17 Transferees and Creditors of Partner

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CHAPTER 45-17TRANSFEREES AND CREDITORS OF PARTNER45-17-01.(501) Partner not coowner of partnership property. A partner is not acoowner of partnership property and has no interest in partnership property which can be<br>transferred, either voluntarily or involuntarily.45-17-02. (502) Partner's transferable interest in partnership. The only transferableinterest of a partner in the partnership is the partner's share of the profits and losses of the<br>partnership and the partner's right to receive distributions. The interest is personal property.45-17-03. (503) Transfer of partner's transferable interest.1.A transfer, in whole or in part, of a partner's transferable interest in the partnership:a.Is permissible;b.Does not by itself cause the partner's dissociation or a dissolution and winding<br>up of the partnership business; andc.Does not, as against the other partners or the partnership, entitle the<br>transferee, during the continuance of the partnership, to participate in the<br>management or conduct of the partnership business, to require access to<br>information concerning partnership transactions, or to inspect or copy the<br>partnership books or records.2.A transferee of a partner's transferable interest in the partnership has a right:a.To receive, in accordance with the transfer, distributions to which the transferor<br>would otherwise be entitled;b.To receive upon the dissolution and winding up of the partnership business, in<br>accordance with the transfer, the net amount otherwise distributable to the<br>transferor; andc.To seek under subsection 6 of section 45-20-01 a judicial determination that it<br>is equitable to wind up the partnership business.3.In a dissolution and winding up, a transferee is entitled to an account of partnership<br>transactions only from the date of the latest account agreed to by all of the partners.4.Upon transfer, the transferor retains the rights and duties of a partner other than the<br>interest in distributions transferred.5.A partnership need not give effect to a transferee's rights under this section until it<br>has notice of the transfer.6.A transfer of a partner's transferable interest in the partnership in violation of a<br>restriction on transfer contained in the partnership agreement is ineffective as to a<br>person having notice of the restriction at the time of transfer.45-17-04. (504) Partner's transferable interest subject to charging order.1.On application by a judgment creditor of a partner or of a partner's transferee, a<br>court having jurisdiction may charge the transferable interest of the judgment debtor<br>to satisfy the judgment.The court may appoint a receiver of the share of thedistributions due or to become due to the judgment debtor in respect of the<br>partnership and make all other orders, directions, accounts, and inquiries thePage No. 1judgment debtor might have made or which the circumstances of the case may<br>require.2.A charging order constitutes a lien on the judgment debtor's transferable interest in<br>the partnership. The court may order a foreclosure of the interest subject to the<br>charging order at any time. The purchaser at the foreclosure sale has the rights of a<br>transferee.3.At any time before foreclosure, an interest charged may be redeemed:a.By the judgment debtor;b.With property other than partnership property, by one or more of the other<br>partners; orc.With partnership property, by one or more of the other partners with the<br>consent of all of the partners whose interests are not so charged.4.Chapters 45-13 through 45-21 do not deprive a partner of a right under exemption<br>laws with respect to the partner's interest in the partnership.5.This section provides the exclusive remedy by which a judgment creditor of a partner<br>or partner's transferee may satisfy a judgment out of the judgment debtor's<br>transferable interest in the partnership.Page No. 2Document Outlinechapter 45-17 transferees and creditors of partner