SB657: Bill Text

SB657,72,13 2. Preserve the partnership business and property as a going concern for a reasonable time.

SB657,72,15 3. Prosecute and defend actions and proceedings, whether civil, criminal, or administrative.

SB657,72,16 4. Transfer the partnership's property.

SB657,72,17 5. Settle disputes by mediation or arbitration.

SB657,72,19 6. Deliver to the department for filing a statement of termination stating the name of the partnership and that the partnership is terminated.

SB657,72,20 7. Perform other acts necessary or appropriate to the winding up.

SB657,72,22 (3) A person whose dissociation as a partner resulted in dissolution may participate in winding up as if still a partner, unless the dissociation was wrongful.

SB657,73,7 (4) If a dissolved partnership does not have a partner and no person has the right to participate in winding up under sub. (3), the personal or legal representative of the last person to have been a partner may wind up the partnership's business. If no person has or exercises the right to participate in winding up, a person to wind up the partnership's business may be appointed by the affirmative vote or consent of transferees owning a majority of the rights to receive distributions at the time the consent is to be effective. A person appointed under this subsection has the powers of a partner under s. 178.0804 but is not liable for the debts, obligations, and other liabilities of the partnership solely by reason of having or exercising those powers or otherwise acting to wind up the partnership's business.

SB657,73,11 (5) On the application of any partner or person entitled under sub. (3) to participate in winding up, the circuit court may order judicial supervision of the winding up of a dissolved partnership, including the appointment of a person to wind up the partnership's business, if any of the following applies:

SB657,73,13 (a) The partnership does not have a partner and within a reasonable time following the dissolution no person has been appointed under sub. (4).

SB657,73,14 (b) The applicant establishes other good cause.

SB657,73,18 178.0803 Rescinding dissolution. (1) A partnership may rescind its dissolution, unless a statement of termination applicable to the partnership has become effective or the circuit court has entered an order under s. 178.0801 (4) or (5) dissolving the partnership.

SB657,73,19 (2) Rescinding dissolution under this section requires all of the following:

SB657,73,20 (a) The affirmative vote or consent of each partner.

SB657,73,23 (b) If the partnership has delivered to the department for filing a statement of dissolution, delivery to the department for filing of one of the following additional statements:

SB657,73,25 1. If the statement of dissolution has not become effective, a statement of withdrawal under s. 178.0115 applicable to the statement of dissolution.

SB657,74,3 2. If the statement of dissolution has become effective, a statement of rescission stating the name of the partnership and that dissolution has been rescinded under this section.

SB657,74,4 (3) If a partnership rescinds its dissolution, all of the following apply:

SB657,74,6 (a) The partnership resumes carrying on its business as if dissolution had never occurred.

SB657,74,9 (b) Subject to par. (c), any liability incurred by the partnership after the dissolution and before the rescission has become effective is determined as if dissolution had never occurred.

SB657,74,12 (c) The rights of a third party arising out of conduct in reliance on the dissolution before the third party knew or had notice of the rescission may not be adversely affected.

SB657,74,15 178.0804 Power to bind partnership after dissolution. (1) A partnership is bound by a partner's act with respect to a transaction with another person after dissolution if any of the following applies:

SB657,74,19 (a) The act is appropriate for winding up the partnership business, unless the partner did not have authority to act for the partnership in the particular matter and the person with which the partner was dealing knew or had notice that the partner lacked authority.

SB657,74,22 (b) The act would have bound the partnership under s. 178.0301 before dissolution if, at the time the other party enters into the transaction, the other party does not know or have notice of the dissolution.

SB657,74,25 (2) A person dissociated as a partner binds a partnership with respect to a transaction with another party through an act occurring after dissolution if all of the following apply:

SB657,75,2 (a) At the time the other party enters into the transaction, less than 2 years has passed since the dissociation.

SB657,75,5 (b) At the time the other party enters into the transaction, the other party does not know or have notice of the dissociation and reasonably believes that the person is a partner.

SB657,75,9 (c) The act is appropriate for winding up the partnership's business or the act would have bound the partnership under s. 178.0301 before dissolution and at the time the other party enters into the transaction the other party does not know or have notice of the dissolution.

SB657,75,14 178.0805 Liability after dissolution of partner and person dissociated as partner. (1) If a partner having knowledge of the dissolution causes a partnership to incur an obligation under s. 178.0804 (1) by an act that is not appropriate for winding up the partnership business, the partner is liable to all of the following:

SB657,75,16 (a) The partnership, for any damage caused to the partnership arising from the obligation.

SB657,75,19 (b) If another partner or person dissociated as a partner is liable for the obligation, that other partner or person, for any damage caused to that other partner or person arising from the liability.

SB657,75,22 (2) Except as otherwise provided in sub. (3), if a person dissociated as a partner causes a partnership to incur an obligation under s. 178.0804 (2), the person is liable to all of the following:

SB657,75,24 (a) The partnership, for any damage caused to the partnership arising from the obligation.

SB657,76,3 (b) If a partner or another person dissociated as a partner is liable for the obligation, the partner or other person, for any damage caused to the partner or other person arising from the liability.

SB657,76,5 (3) A person dissociated as a partner is not liable under sub. (2) if all of the following apply:

SB657,76,6 (a) Section 178.0802 (3) permits the person to participate in winding up.

SB657,76,8 (b) The act that causes the partnership to be bound under s. 178.0804 (2) is appropriate for winding up the partnership's business.

SB657,76,12 178.0806 Disposition of assets in winding up; when contributions required. (1) In winding up its business, a partnership shall apply its assets, including the contributions required by this section, to discharge the partnership's obligations to creditors, including partners that are creditors.

SB657,76,14 (2) After a partnership complies with sub. (1), any surplus must be distributed in the following order, subject to any charging order in effect under s. 178.0504:

SB657,76,17 (a) To each person owning a transferable interest that reflects contributions made and not previously returned, an amount equal to the value of the unreturned contributions.

SB657,76,20 (b) Among persons owning transferable interests, in proportion to their respective rights to share in distributions immediately before the dissolution of the partnership.

SB657,76,23 (3) If a partnership's assets are insufficient to satisfy all its obligations under sub. (1), with respect to each unsatisfied obligation incurred when the partnership was not a limited liability partnership, the following rules apply:

SB657,77,4 (a) Each person that was a partner when the obligation was incurred and that has not been released from the obligation under s. 178.0703 (3) or (4) shall contribute to the partnership for the purpose of enabling the partnership to satisfy the obligation. The contribution due from each of those persons is in proportion to the right to receive distributions in the capacity of a partner in effect for each of those persons when the obligation was incurred.

SB657,77,11 (b) If a person does not contribute the full amount required under par. (a) with respect to an unsatisfied obligation of the partnership, the other persons required to contribute by par. (a) on account of the obligation shall contribute the additional amount necessary to discharge the obligation. The additional contribution due from each of those other persons is in proportion to the right to receive distributions in the capacity of a partner in effect for each of those other persons when the obligation was incurred.

SB657,77,14 (c) If a person does not make the additional contribution required by par. (b), further additional contributions are determined and due in the same manner as provided in that paragraph.

SB657,77,19 (4) A person that makes an additional contribution under sub. (3) (b) or (c) may recover from any person whose failure to contribute under sub. (3) (a) or (b) necessitated the additional contribution. A person may not recover under this subsection more than the amount additionally contributed. A person's liability under this subsection may not exceed the amount the person failed to contribute.

SB657,77,22 (5) If a partnership does not have sufficient surplus to comply with sub. (2) (a), any surplus must be distributed among the owners of transferable interests in proportion to the value of the respective unreturned contributions.

SB657,77,23 (7) All distributions made under sub. (2) must be paid in money.

SB657,78,2 178.0807 Known claims against dissolved limited liability partnership. (1) Except as otherwise provided in sub. (4), a dissolved limited liability partnership may give notice of a known claim under sub. (2), which has the effect provided in sub. (3).

SB657,78,4 (2) A dissolved limited liability partnership may in a record notify its known claimants of the dissolution. The notice must do all of the following:

SB657,78,5 (a) Specify the information required to be included in a claim.

SB657,78,7 (b) State that a claim must be in writing and provide a mailing address to which the claim is to be sent.

SB657,78,9 (c) State the deadline for receipt of a claim, which may not be less than 120 days after the date the notice is received by the claimant.

SB657,78,10 (d) State that the claim will be barred if not received by the deadline.

SB657,78,14 (e) Unless the partnership has been throughout its existence a limited liability partnership, state that the barring of a claim against the partnership will also bar any corresponding claim against any partner or person dissociated as a partner which is based on s. 178.0306.

SB657,78,17 (3) A claim against a dissolved limited liability partnership is barred if the claim is a known claim and the notice requirements of sub. (2) are met with respect to the claim and any of the following applies:

SB657,78,18 (a) The claim is not received by the specified deadline.

SB657,78,20 (b) If the claim is timely received but rejected by the limited liability partnership, all of the following apply:

SB657,78,24 1. The partnership causes the claimant to receive a notice in a record stating that the claim is rejected and will be barred unless the claimant commences an action against the partnership to enforce the claim within 90 days after the claimant receives the notice.

SB657,79,2 2. The claimant does not commence the required action within 90 days after the claimant receives the notice.

SB657,79,4 (4) This section does not apply to a claim based on an event occurring after the date of dissolution or a liability that on that date is contingent.

SB657,79,5 (4r) The provisions of s. 178.0103 (6) shall apply to notices under this section.

SB657,79,9 178.0808 Other claims against dissolved limited liability partnership. (1) A dissolved limited liability partnership may publish notice of its dissolution and request persons having claims against the partnership to present them in accordance with the notice.

SB657,79,10 (2) A notice under sub. (1) must satisfy all of the following:

SB657,79,15 (a) It must be published as a class 1 notice, under ch. 985, in a newspaper of general circulation in the county in this state in which the dissolved limited liability partnership's principal office is located or, if the principal office is not located in this state, in the county in which the office of the partnership's registered agent is or was last located.

SB657,79,18 (b) It must describe the information required to be contained in a claim, state that the claim must be in writing, and provide a mailing address to which the claim is to be sent.

SB657,79,21 (c) It must state that a claim against the partnership is barred unless an action to enforce the claim is commenced not later than 2 years after publication of the notice.

SB657,79,25 (d) Unless the partnership has been throughout its existence a limited liability partnership, it must state that the barring of a claim against the partnership will also bar any corresponding claim against any partner or person dissociated as a partner which is based on s. 178.0306.

SB657,80,4 (3) If a dissolved limited liability partnership publishes a notice in accordance with sub. (2), the claim of each of the following claimants is barred unless the claimant commences an action to enforce the claim against the partnership not later than 2 years after the publication date of the notice:

SB657,80,5 (a) A claimant that did not receive notice in a record under s. 178.0807.

SB657,80,7 (b) A claimant whose claim was timely sent to the partnership but not acted on.

SB657,80,9 (c) A claimant whose claim is contingent at, or based on an event occurring after, the date of dissolution.

SB657,80,11 (4) A claim not barred under this section or s. 178.0807 may be enforced against any of the following:

SB657,80,13 (a) A dissolved limited liability partnership, to the extent of its undistributed assets.

SB657,80,19 (b) Except as otherwise provided in s. 178.0809, if assets of the partnership have been distributed after dissolution, a partner or transferee to the extent of that person's proportionate share of the claim or of the partnership's assets distributed to the partner or transferee after dissolution, whichever is less, but a person's total liability for all claims under this paragraph may not exceed the total amount of assets distributed to the person after dissolution.

SB657,80,20 (c) Any person liable on the claim under s. 178.0306, 178.0703, or 178.0805.

SB657,81,4 178.0809 Court proceedings. (1) A dissolved limited liability partnership that has published a notice under s. 178.0808 may file an application with the circuit court in the county where the partnership's principal office is located or, if the principal office is not located in this state, where the office of its registered agent is or was last located, for a determination of the amount and form of security to be provided for payment of claims that are contingent or are not known to the partnership or that are based on an event occurring after the effective date of dissolution but that, based on the facts known to the partnership, are reasonably expected to arise after the effective date of dissolution.

SB657,81,6 (2) Provision need not be made for any claim that is or is reasonably anticipated to be barred under s. 178.0808.

SB657,81,10 (3) Not later than 10 days after the filing of an application under sub. (1), the dissolved limited liability partnership shall give notice of the proceeding to each claimant holding a contingent claim whose contingent claim is known to the partnership.

SB657,81,14 (4) In any proceeding under this section, the court may appoint a guardian ad litem to represent all claimants whose identities are unknown. The reasonable fees and expenses of the guardian, including all reasonable expert witness fees, must be paid by the dissolved limited liability partnership.

SB657,81,20 (5) A dissolved limited liability partnership that provides security in the amount and form ordered by the court under sub. (1) satisfies the partnership's obligations with respect to claims that are contingent, are not known to the partnership, or are based on an event occurring after the effective date of dissolution, and such claims may not be enforced against a partner or transferee on account of assets received in liquidation.

SB657,81,24 178.0810 Liability of partner and person dissociated as partner when claim against partnership barred. If a claim against a dissolved partnership is barred under s. 178.0807, 178.0808, or 178.0809, any corresponding claim under s. 178.0306, 178.0703, or 178.0805 is also barred.

SB657,81,25 subchapter Ix

SB657,82,1 limited liability partnership

SB657,82,3 178.0901 Statement of qualification. (1) A domestic partnership may become a limited liability partnership pursuant to this section.

SB657,82,8 (2) The terms and conditions on which a domestic partnership becomes a limited liability partnership must be approved by the affirmative vote or consent necessary to amend the partnership agreement except, in the case of a partnership agreement that expressly addresses obligations to contribute to the partnership, the affirmative vote or consent necessary to amend those provisions.

SB657,82,11 (3) After the approval required by sub. (2), a partnership may become a limited liability partnership by delivering to the department for filing a statement of qualification. The statement must contain all of the following:

SB657,82,12 (a) The name of the partnership, which name satisfies s. 178.0902.

SB657,82,14 (b) The street and mailing addresses of the partnership's principal office and, if different, the street address of an office in this state, if any.