Effect of charging order.

- The charging order remedy entitles the creditor to receive the profits and surplus of the limited partnership, which the limited partner would otherwise have been entitled to receive, up to the unsatisfied amount of the judgment debt, but gives no direct remedy against specific limited partnership property. Nigri v. Lotz, 216 Ga. App. 204, 453 S.E.2d 780 (1995).

A charging order under O.C.G.A. § 14-9A-52 is not an assignment of the limited partner's interest to the creditor, nor does it confer upon the creditor the status of a substituted limited partner. Nigri v. Lotz, 216 Ga. App. 204, 453 S.E.2d 780 (1995).

Foreclosure of charged interest.

- As an aid to enforcement of a charging order, the trial court is authorized to order that a limited partner's charged interest be foreclosed by judicial sale at which the partnership interest may be purchased by the judgment creditor or a third party. Nigri v. Lotz, 216 Ga. App. 204, 453 S.E.2d 780 (1995).

A charging order is considered the primary method of satisfying the creditor's judgment, but the further step of ordering a sale may be considered appropriate where it is apparent that distributions under the charging order will not pay the judgment debt within a reasonable period of time. Nigri v. Lotz, 216 Ga. App. 204, 453 S.E.2d 780 (1995).

Transfer of a charged interest that the debtor partner would have had pursuant to a foreclosure sale did not place the purchaser in the position of a limited partner. Accordingly, if the creditor under the charging order is the purchaser, the creditor does not by virtue of the purchase become a substituted limited partner and is only entitled to receive the distributions to which the debtor limited partner would have been entitled. Nigri v. Lotz, 216 Ga. App. 204, 453 S.E.2d 780 (1995).

The prohibition against sale of a charged interest by O.C.G.A. § 14-8-28 of the Uniform Partnership Act is inconsistent with the charging remedy provisions of O.C.G.A. § 14-9A-52 and does not apply to prohibit foreclosure of the charged interest of a limited partner. Nigri v. Lotz, 216 Ga. App. 204, 453 S.E.2d 780 (1995).

A judgment against a limited partner does not create a lien against the partnership interest. Harris v. C.C. Dickson, Inc. (In re Smith), 17 Bankr. 541 (Bankr. M.D. Ga. 1982).

Financial payments to which a limited partner is entitled pursuant to statute or the partnership/certificate of formation is a chose in action and a judgment creditor must initiate collateral proceedings in order to attach a lien thereto. Prodigy Centers/Atlanta v. T-C Assocs., 269 Ga. 522, 501 S.E.2d 209 (1998).

Broad judicial discretion.

- Trial court has broad discretion as to whether or not to order a foreclosure and judicial sale of charged interests. Nigri v. Lotz, 216 Ga. App. 204, 453 S.E.2d 780 (1995).

A limited partner's interest in the partnership is a chose in action, which is not subject to seizure and sale under executions based upon ordinary judgments. Harris v. C.C. Dickson, Inc. (In re Smith), 17 Bankr. 541 (Bankr. M.D. Ga. 1982).

Partner's interest in a limited partnership was properly subjected to judicial sale to satisfy a judgment for the partnership where the judgment was final as between the parties and such a remedy was within the discretion of the trial court. Stewart v. Lanier Med. Office Bldg., 259 Ga. App. 898, 578 S.E.2d 572 (2003).

Cited in Mahalo Invs. III, LLC v. First Citizens Bank & Trust Co., 330 Ga. App. 737, 769 S.E.2d 154 (2015); Gaslowitz v. Stabilis Fund I, LP, 331 Ga. App. 152, 770 S.E.2d 245 (2015).

Am. Jur. 2d.

- 59A Am. Jur. 2d, Partnership, § 867 et seq.

C.J.S.

- 68 C.J.S., Partnership, §§ 591 et seq., 602 et seq.

U.L.A.

- Uniform Limited Partnership Act (U.L.A.) § 22.

ALR.

- Right to setoff claim of individual partner against claim against partnership, 55 A.L.R. 566.

Right of partnership creditor to proceed against estate of deceased partner, 61 A.L.R. 1410.

Necessity and manner of pleading denial of partnership in action by third person against alleged partners, 68 A.L.R.2d 545.

Law reviews.

- For article on the definition of a security in light of the 1973 Georgia Securities Act and the need for maximizing investor protection, see 30 Emory L.J. 73 (1981).

General partner can bind limited partnership by execution of note.

- A general partner in a limited partnership has power to bind the partnership by that partner's execution of a promissory note on behalf of the partnership where nothing in a limited partnership agreement would limit the power of its general partners to bind the limited partnership in such a manner. Tara Apts., Ltd. v. Citizens & S. Nat'l Bank, 149 Ga. App. 577, 254 S.E.2d 897 (1979).

To bind assets of partner, partner must be served and have that partner's day in court. Sugarman v. Shaginaw, 151 Ga. App. 621, 260 S.E.2d 731 (1979).

Agreement construed to make it impossible for partnership to function.

- Partnership agreement which referred to the security deed held by a general partner and specified that certain capital contributions were to be used to retire that obligation was deemed to be written consent to general partner's foreclosure on security deed which made it impossible for the partnership to carry on its ordinary business. Westminster Properties, Inc. v. Atlanta Assocs., 250 Ga. 841, 301 S.E.2d 636 (1983).

Cited in Coop Mtg. Invs. Assocs. v. Pendley, 134 Ga. App. 236, 214 S.E.2d 572 (1975); North Peachtree I-285 Properties, Ltd. v. Hicks, 136 Ga. App. 426, 221 S.E.2d 607 (1975); Atlanta Whses., Inc. v. Housing Auth., 143 Ga. App. 588, 239 S.E.2d 387 (1977); Third World, Ltd. No. II v. Brewmasters of Augusta, Inc., 155 Ga. App. 352, 270 S.E.2d 891 (1980).

Foreign corporation as general partner.

- A foreign corporation transacting business in Georgia as a general partner in a limited partnership must qualify to do business under O.C.G.A. Ch. 2, T. 14. 1982 Op. Att'y Gen. No. 82-95.

Licensing requirements for general partner who manages partnership property.

- To the extent the general partner in a limited partnership manages the property owned by the partnership full time and receives no separate fee, commission, or salary for the brokerage aspects of this management, it would appear that the general partner is excepted from the licensure and regulatory requirements under former § 43-40-29(7) (now O.C.G.A. § 43-40-29(a)(7)), but, if the general partner also managed the property of others, the exception under former § 43-40-29(7) (now O.C.G.A. § 43-40-29(a)(7)) would not apply and that person would be required to be licensed by the commission. 1984 Op. Att'y Gen. No. 84-80.

Am. Jur. 2d.

- 59A Am. Jur. 2d, Partnership, § 829 et seq.

C.J.S.

- 68 C.J.S., Partnership, § 582 et seq.

U.L.A.

- Uniform Limited Partnership Act (U.L.A.) § 9.

ALR.

- Powers, duties, and accounting responsibilities of managing partner of mining partnership, 24 A.L.R.2d 1359.

Partner's breach of fiduciary duty to copartner on sale of partnership interest to another partner, 4 A.L.R.4th 1122.

Derivative liability of partner for punitive damages for wrongful act of copartner, 14 A.L.R.4th 1335.

Nature of claims against partnership.

- When limited partners alleged that they had not received their portion of the financial items produced by the limited partnership and that their right to vote their shares was violated, it was error to dismiss their claims as derivative, as the alleged injury was to themselves and not to the partnership; however, it was proper to dismiss a claim based on a contractual relationship between the partnership and a third party, as if the claim had any merit it would inure to the benefit of the entire partnership. Hendry v. Wells, 286 Ga. App. 774, 650 S.E.2d 338 (2007), cert. denied, No. S07C1835, 2008 Ga. LEXIS 102 (Ga. 2008).

Am. Jur. 2d.

- 59A Am. Jur. 2d, Partnership, § 873 et seq.

C.J.S.

- 68 C.J.S., Partnership, § 602 et seq.

U.L.A.

- Uniform Limited Partnership Act (U.L.A.) § 26.

ALR.

- Parties plaintiff to actions based on libel or slander of a firm or its members, 52 A.L.R. 912.

Am. Jur. 2d.

- 59A Am. Jur. 2d, Partnership, § 813 et seq.

C.J.S.

- 68 C.J.S., Partnership, § 610 et seq.

U.L.A.

- Uniform Limited Partnership Act (U.L.A.) § 20.

ALR.

- Right of solvent partner to close firm business upon bankruptcy or insolvency of copartner, 29 A.L.R. 45.

Relative rights of surviving partner and the estate of the deceased partner in proceeds of life insurance acquired pursuant to partnership agreement, 83 A.L.R.2d 1347.

Treatment of Family Limited Partnership for Federal Estate and Gift Tax Purposes, 27 A.L.R. Fed. 2d 559.