35-12-1521. Power of general partners and persons dissociated as general partners to bind organization after conversion or merger.
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/mt/title-35/chapter-12/part-15/35-12-1521·A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
35-12-1521 . Power of general partners and persons dissociated as general partners to bind organization after conversion or merger.
(1)An act of a person that immediately before a conversion or merger became effective was a general partner in a converting limited partnership or constituent limited partnership binds the converted organization or surviving organization after the conversion or merger becomes effective if:
(a)before the conversion or merger became effective, the act would have bound the converting limited partnership or constituent limited partnership under 35-12-806 ; and
(b)at the time the third party enters into the transaction, the third party:
(i)does not have notice of the conversion or merger; and
(ii)reasonably believes that the converted or surviving business is the converting limited partnership or constituent limited partnership and that the person is a general partner in the converting limited partnership or constituent limited partnership.
(2)An act of a person that before a conversion or merger became effective was dissociated as a general partner from a converting limited partnership or constituent limited partnership binds the converted organization or surviving organization after the conversion or merger becomes effective if:
(a)before the conversion or merger became effective, the act would have bound the converting limited partnership or constituent limited partnership under 35-12-806 if the person had been a general partner; and
(b)at the time the third party enters into the transaction, less than 2 years have passed since the person dissociated as a general partner and the third party:
(i)does not have notice of the dissociation;
(ii)does not have notice of the conversion or merger; and
(iii)reasonably believes that the converted organization or surviving organization is the converting limited partnership or constituent limited partnership and that the person is a general partner in the converting limited partnership or constituent limited partnership.
(3)If a person having knowledge of the conversion or merger causes a converted organization or surviving organization to incur an obligation under subsection
(1)or (2), the person is liable:
(a)to the converted organization or surviving organization for any damage caused to the organization arising from the obligation; and
(b)if another person is liable for the obligation, to that other person for any damage caused to that other person arising from the liability.