Continuation of Business After Withdrawal or Death of a Partner

  1. Law
  2. Georgia Code
  3. Corporations, Partnerships, and Associations
  4. Partnerships
  5. Continuation of Business After Withdrawal or Death of a Partner

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When any partner withdraws or dies, and the business is continued under any of the conditions set forth in subsection (a) of Code Section 14-8-41 or paragraph (2) of subsection (b) of Code Section 14-8-38, without any settlement of accounts as between the withdrawn partner or the legal representative of the estate of a deceased partner and the persons or partnership continuing the business, unless otherwise agreed:

  1. Such persons or partnership shall obtain the discharge of the withdrawn partner or the legal representative of the estate of the deceased partner, or appropriately hold him harmless from all present or future partnership liabilities, and shall ascertain the value of his interest at the date of dissolution; and
  2. The withdrawn partner or legal representative of the estate of the deceased partner shall receive as an ordinary creditor an amount equal to the value of his interest in the dissolved partnership with interest, or, at his option, in lieu of interest, the profits attributable to the use of his right in the property of the dissolved partnership, provided that the creditors of the dissolved partnership as against the separate creditors, or the representative of the withdrawn or deceased partner, shall have priority on any claim arising under this Code section, as provided by subsection (d) of Code Section 14-8-41.

(Code 1981, §14-8-42, enacted by Ga. L. 1984, p. 1439, § 1; Ga. L. 1985, p. 1436, § 7; Ga. L. 1990, p. 257, § 33.)

RESEARCH REFERENCES

Am. Jur. 2d.

- 59A Am. Jur. 2d, Partnership, §§ 85 et seq., 713 et seq.

C.J.S.

- 68 C.J.S., Partnership, §§ 305 et seq., 364 et seq.

ALR.

- Admissibility of evidence of plaintiff's or decedent's drawings from partnership or other business as evidence of earning capacity, in action for personal injury or death, 82 A.L.R.2d 679.


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