Actions by Partners

1. Law
2. Illinois Compiled Statutes
3. BUSINESS ORGANIZATIONS
4. Uniform Limited Partnership Act (2001).
5. Actions by Partners

(805 ILCS 215/Art. 10 heading)

ARTICLE 10 ACTIONS BY PARTNERS

 

(805 ILCS 215/1001)

Sec. 1001. Direct action by partner.

(a) Subject to subsection (b), a partner may maintain a direct action against the limited partnership or another partner for legal or equitable relief, with or without an accounting as to the partnership's activities, to enforce the rights and otherwise protect the interests of the partner, including rights and interests under the partnership agreement or this Act or arising independently of the partnership relationship.

(b) A partner commencing a direct action under this Section is required to plead and prove an actual or threatened injury that is not solely the result of an injury suffered or threatened to be suffered by the limited partnership.

(c) The accrual of, and any time limitation on, a right of action for a remedy under this Section is governed by other law. A right to an accounting upon a dissolution and winding up does not revive a claim barred by law.

(Source: P.A. 93-967, eff. 1-1-05.)

 

(805 ILCS 215/1002)

Sec. 1002. Derivative action. A partner may maintain a derivative action to enforce a right of a limited partnership if:

• (1) the partner first makes a demand on the general partners, requesting that they cause the limited partnership to bring an action to enforce the right, and the general partners do not bring the action within a reasonable time; or
• (2) a demand would be futile.

(Source: P.A. 93-967, eff. 1-1-05.)

 

(805 ILCS 215/1003)

Sec. 1003. Proper plaintiff. A derivative action may be maintained only by a person that is a partner at the time the action is commenced and:

• (1) that was a partner when the conduct giving rise to the action occurred; or
• (2) whose status as a partner devolved upon the person by operation of law or pursuant to the terms of the partnership agreement from a person that was a partner at the time of the conduct.

(Source: P.A. 93-967, eff. 1-1-05.)

 

(805 ILCS 215/1004)

Sec. 1004. Pleading. In a derivative action, the complaint must state with particularity:

• (1) the date and content of plaintiff's demand and the general partners' response to the demand; or
• (2) why demand should be excused as futile.

(Source: P.A. 93-967, eff. 1-1-05.)

 

(805 ILCS 215/1005)

Sec. 1005. Proceeds and expenses.

(a) Except as otherwise provided in subsection (b):

• (1) any proceeds or other benefits of a derivative action, whether by judgment, compromise, or settlement, belong to the limited partnership and not to the derivative plaintiff;
• (2) if the derivative plaintiff receives any proceeds, the derivative plaintiff shall immediately remit them to the limited partnership.

(b) If a derivative action is successful in whole or in part, the court may award the plaintiff reasonable expenses, including reasonable attorney's fees, from the recovery of the limited partnership.

(Source: P.A. 93-967, eff. 1-1-05.)

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