Sec. 607. Liability to other persons of person dissociated as general partner.

293 words·~1 min read·/il/chapter-805/act-215/607

A research copy — for the controlling text, always check the official state or federal source. Not legal advice.

(a)A person's dissociation as a general partner does not of itself discharge the person's liability as a general partner for an obligation of the limited partnership incurred before dissociation. Except as otherwise provided in subsections

(b)and (c), the person is not liable for a limited partnership's obligation incurred after dissociation.

(b)A person whose dissociation as a general partner resulted in a dissolution and winding up of the limited partnership's activities is liable to the same extent as a general partner under Section 404 on an obligation incurred by the limited partnership under Section 804.

(c)A person that has dissociated as a general partner but whose dissociation did not result in a dissolution and winding up of the limited partnership's activities is liable on a transaction entered into by the limited partnership after the dissociation only if:

(1)a general partner would be liable on the transaction; and

(2)at the time the other party enters into the transaction:

(A)less than two years has passed since the dissociation; and

(B)the other party does not have notice of the dissociation and reasonably believes

that the person is a general partner.

(d)By agreement with a creditor of a limited partnership and the limited partnership, a person dissociated as a general partner may be released from liability for an obligation of the limited partnership.

(e)A person dissociated as a general partner is released from liability for an obligation of the limited partnership if the limited partnership's creditor, with 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 obligation.