§ 7-12-49 - Rights of partners to application of partnership property.
SECTION 7-12-49
§ 7-12-49 Rights of partners toapplication of partnership property. – (a) When dissolution is caused in any way, except in contravention of thepartnership agreement, each partner, as against his or her copartners and allpersons claiming through them in respect of their interests in the partnership,unless otherwise agreed, may have the partnership property applied to dischargeits liabilities, and the surplus applied to pay in cash the net amount owing tothe respective partners. But if dissolution is caused by the expulsion of abona fide partner under the partnership agreement, and if the expelled partneris discharged from all partnership liabilities, either by payment or agreementunder § 7-12-47(2), he or she receives in cash only the net amount due himor her from the partnership.
(b) When dissolution is caused in contravention of thepartnership agreement the rights of the partners are as follows:
(1) Each partner who has not wrongfully caused dissolutionhas,
(i) All the rights specified in subsection (a), and
(ii) The right, as against each partner who has wrongfullycaused the dissolution to damages for breach of the agreement.
(2) The partners who have not wrongfully caused thedissolution, if they all desire to continue the business in the same name,either by themselves or jointly with others, may do so, during the agreed termfor the partnership and for that purpose may possess the partnership property,provided they secure the payment by bond approved by the court, or pay to anypartner who has wrongfully caused the dissolution, the value of his or herinterest in the partnership at the dissolution, less any damages recoverableunder subsection (b)(1)(ii), and in like manner indemnify him or her againstall present or future partnership liabilities.
(3) A partner who has wrongfully caused the dissolution has:
(i) If the business is not continued under the provisions ofsubsection (b)(2) all the rights of a partner under subsection (a); subject tosubsection (b)(1)(ii).
(ii) If the business is continued under subsection (b)(2) theright as against his or her copartners and all claiming through them as totheir interests in the partnership, to have the value of his or her interest inthe partnership, less any damages caused to his or her copartners by thedissolution, ascertained and paid to him or her in cash, or the payment securedby bond approved by the court, and to be released from all existing liabilitiesof the partnership; but in ascertaining the value of the partner's interest thevalue of the good will of the business is not considered.