7/17/2019 Dissolution and Winding Up

http://slidepdf.com/reader/full/dissolution-and-winding-up 1/2

DISSOLUTION AND WINDING UP

Dissolution of Partnership – Is the change in

the relation of the partners caused b an

partner ceasing to be associated in the

carring on as distinguished fro! the

"inding up of the business# $A%T# &'(')

Dissolution does not ter!inate thepartnership but continues until the "inding

up# $A%T# &'(*)

+auses of Dissolution, $A%T# &'-.)

$&) Without /iolation of the agree!ent

bet"een the partners,$a) Ter!ination of the de0nite ter! or

particular underta1ing speci0ed in

the agree!ent$b) 23press "ill4 in good faith4 "hen no

de0nite ter! or particular

underta1ing is speci0ed$c) 23press "ill of all the partners "ho

ha/e not assigned their interests or

su5ered b the! to be charged for

their separate debts$d) 23pulsion of an partner

$() In contra/ention of the agree!ent$-) 6 an e/ent "hich !a1es it unla"ful

for the partnership or for the !e!bers

to carr on the partnership business$7) When a speci0c thing4 "hich a partner

had pro!ised to contribute to the

partnership4 perishes before the

deli/er$8) 6 death of an partner$9) 6 the insol/enc of an partner or the

partnership$:) 6 ci/il interdiction of an partner$') 6 decree of court under A%T &:..

and &:.&

 The court shall decree dissolution on

application b or for a partner o "hene/er,

$A%T# &'-&)

$&) A partner has been declared insane in

an ;udicial proceeding or is sho"n to

be of unsound !ind

$()A partner beco!es incapable of

perfor!ing his part of the partnership$-) A partner has been guilt of such

conduct as tends to a5ect pre;udiciall

the carring on of the business$7) A partner "illfull or persistentl

co!!its breach of the partnership

agree!ent or conducts hi!self in

!atters relating to the partnership

business that is not reasonabl

practicable to carr on the business in

partnership$8)The business of the partnership can

onl be carried on at a loss$9) Other circu!stances render a

dissolution e<uitable

On the application of the purchaser of a

partner=s interest under A%T &'&- or &'&7,

$&) After the ter!ination of the speci0ed

ter! or particular underta1ing$()At an ti!e if the partnership "as a

partnership at "ill "hen the interest

"hen the charging order "as issued#

General %ule, Dissolution ter!inates al

authorit of an partner to act for the

partnership, $A%T &'-()

$&) With respect to the partners4$a) When the dissolution is NOT b the

act4 insol/enc or death of a

partner$b) When the dissolution is b such

act4 insol/enc or death of a

partner4 in cases "here A%T# &'--

so re<uires$() With respect to persons not partners

as declared in A%T# &'-7

23ception, As so far as !a be necessar to"ind up partnership a5airs or to co!plete

transactions begu! but not then 0nished#

In reference to A%T# &'-( $&) $b)4 each

partner is liable to his co>partners for his

share of an liabilit created b an partner

acting for the partnership as if the

partnership had not been dissol/ed4 UNL2SS

$A%T# &'--)

7/17/2019 Dissolution and Winding Up

http://slidepdf.com/reader/full/dissolution-and-winding-up 2/2

$&) The dissolution being b act of an

partner4 the partner acting for the

partnership had 1no"ledge of the

dissolution$() The dissolution being b death or

insol/enc of a partner4 the partner

acting for the partnership had

1no"ledge or notice of the death or

insol/enc#

Discharge of a partner fro! liabilit, $A%T#

&'-8)

 The dissolution of partnership does not of 

itself discharge the e3isting liabilit of an

partner#

 The partner is discharged for! an e3isting

liabilit b an agree!ent to that e5ect

bet"een hi!self4 the partnership creditorand the person or partnership continuing the

business#

 The agree!ent !a be inferred fro! the

course of dealing bet"een the creditor

ha/ing 1no"ledge of the dissolution and the

person or partnership continuing the

business#

 The indi/idual propert of a deceased

partner shall be liable for all obligations of

the partnership incurred "hile he "as a

partner4 but sub;ect to the prior pa!ent of

his separate debts#

%ight to "ind up the partnership a5airs $A%T

&'-9)

?Unless other"ise agreed upon,

$&) The partners "ho ha/e not "rongfull

dissol/ed the partnership#

$() The legal representati/e of the last

sur/i/ing partner not insol/ent

P%O@ID2D, An partner4 legal representati/eor his assignee4 upon cause sho"n4 !a

obtain "inding up b the court