(a) When dissolution is caused in any way, except in contravention of the partnership agreement, each partner, as against his copartners and all persons claiming through them in respect of their interest in the partnership, unless otherwise agreed, may have the partnership property applied to discharge its liabilities, and the surplus applied to pay in cash the net amount owing to the respective partners. But if dissolution is caused by expulsion of a partner, bona fide under the partnership agreement, and if the expelled partner is discharged from all partnership liabilities, either by payment or agreement under G.S. 59-66, subsection (b), he shall receive in cash only the net amount due him from the partnership.
(b) When dissolution is caused in contravention of the partnership agreement the rights of the partners shall be as follows:
(1) Each partner who has not caused dissolution wrongfully shall have:
a. All the rights specified in subsection (a) of this section, and
b. The right, as against each partner who has caused the dissolution wrongfully, to damages for breach of the agreement.
(2) The partners who have not caused the dissolution wrongfully, if they all desire to continue the business in the same name, either by themselves or jointly with others, may do so, during the agreed term for the partnership and for that purpose may possess the partnership property, provided they secure the payment by bond approved by the court, or pay to any partner who has caused the dissolution wrongfully, the value of his interest in the partnership at the dissolution, less any damages recoverable under clause (b)(1)b of this section, and in like manner indemnify him against all present or future partnership liabilities.
(3) A partner who has caused the dissolution wrongfully shall have:
a. If the business is not continued under the provisions of subdivision (b)(2) all the rights of a partner under subsection (a), subject to clause (b)(1)b, of this section,
b. If the business is continued under subdivision (b)(2) of this section, the right as against his copartners and all claiming through them in respect of their interests in the partnership, to have the value of his interest in the partnership, less any damages caused to his copartners by the dissolution, ascertained and paid to him in cash, or the payment secured by bond approved by the court, and to be released from all existing liabilities of the partnership; but in ascertaining the value of the partner's interest the value of the goodwill of the business shall not be considered. (1941, c. 374, s. 38.)
Notes of Decisions
Cited in
7
cases (
2 in the last 5 years), 1954–2023 · leading case:
Casey v. Grantham, 79 S.E.2d 735 (N.C. 1954).
Casey v. Grantham, 79 S.E.2d 735 (N.C. 1954).
· cites it 3× “G.S. 59-68 (1) reads: “When dissolution is caused in any way, except in contravention of the partnership agreement, each partner, as against his co-partners and all persons claiming through them in respect of their interest in the partnership, unless otherwise agreed, may have…”
Ludwig v. Walter, 331 S.E.2d 177 (N.C. Ct. App. 1985).
· cites it 2× “N.C. Gen. Stat. § 59-68 (1982). An order of dissolution, having been prayed for and not resisted, undoubtedly was appropriate.”
Ewing v. Caldwell, 89 S.E.2d 774 (N.C. 1955).
“G.S. 59-68 (1). The rules for settlement of accounts between partners after dissolution are defined.”
Chesson v. Rives, 2013 NCBC 49 (N.C. Bus. Ct. 2013).
· cites it 6× “N.C. Gen. Stat. § 59-68 . Absent agreement to the contrary, upon dissolution which was not caused by contravention of the partnership agreement, a partner’s right is his pro rata share of the net value of the partnership assets at the time of dissolution.”
Nallapati v. Justh Holdings LLC (E.D.N.C. 2023).
· cites it 4× “§ 59-68 (b)(2). In fact, even now, Vamsi still denies both that a partnership even existed and | that any of the trademarks qualified as partnership property.”
Morris Int'l, Inc. v. Packer, 2021 NCBC 13 (N.C. Bus. Ct. 2021).
· cites it 3× “Section 59-51, titled “Partner accountable as a fiduciary,” provides, “[e]very partner must account to the partnership for any benefit, and hold as trustee for it any profits derived by him without the consent of the other partners from any transaction connected with the…”
Hardin v. Lewis, 2016 NCBC 55 (N.C. Bus. Ct. 2016).
· cites it 2× “Similarly, in interpreting section 38(1) of the Uniform Partnership Act, the liquidation right noted above and codified at G.S. § 59-68, courts have concluded that, in an appropriate case, a buyout of the withdrawing partner's interest may be more appropriate than ordering a…”
— N.C. Gen. Stat. § 59-68(1) — 1 case
Casey v. Grantham, 79 S.E.2d 735 (N.C. 1954).
“G.S. 59-68 (1) reads: “When dissolution is caused in any way, except in contravention of the partnership agreement, each partner, as against his co-partners and all persons claiming through them in respect of their interest in the partnership, unless otherwise agreed, may have…”
— N.C. Gen. Stat. § 59-68(b)(2) — 1 case
Nallapati v. Justh Holdings LLC (E.D.N.C. 2023).
“§ 59-68 (b)(2). In fact, even now, Vamsi still denies both that a partnership even existed and | that any of the trademarks qualified as partnership property.”
— N.C. Gen. Stat. § 59-68(b)(3) — 1 case
Chesson v. Rives, 2013 NCBC 49 (N.C. Bus. Ct. 2013).
“N.C. Gen. Stat. § 59-68 . Absent agreement to the contrary, upon dissolution which was not caused by contravention of the partnership agreement, a partner’s right is his pro rata share of the net value of the partnership assets at the time of dissolution.”
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