University of Maryland Extension

Partnerships Need a Plan for Winding Down Affairs

Paul Goeringer

Photo by Edwin Remsberg

This post is not legal advice

Earlier, I posted on family limited partnerships, I'm continuing the theme today with what happens when a general partner passes away.  For example, father and son start a general partnership to run the farm.  This partnership will continue till the partners agree to dissolve the partnership or the death of a partner.  Similar to a sole proprietorship ending at the death of the owner, a partnership ends at the death of a partner.  But a partnership does not terminate until the partnership's business affairs are wound up (§ 9a-802).  Looking back at my example, if father passes away then the partnership dissolves, but the partnership does not end until the affairs are wound up.  A recent decision by the Court of Special Appeals of Maryland highlights the importance of winding up partnership affairs can be.

To continue reading this post, click over the Maryland Risk Management Education Blog.

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