358.410. Liability of persons continuing the business in certain cases.
Liability of persons continuing the business in certain cases.
358.410. 1. When any new partner is admitted into anexisting partnership, or when any partner retires and assigns, orthe representative of the deceased partner assigns, his rights inpartnership property to two or more of the partners, or to one ormore of the partners and one or more third persons, if thebusiness is continued without liquidation of the partnershipaffairs, creditors of the first or dissolved partnership are alsocreditors of the partnership so continuing the business.
2. When all but one partner retire and assign, or therepresentative of a deceased partner assigns, their rights inpartnership property to the remaining partner, who continues thebusiness without liquidation of partnership affairs, either aloneor with others, creditors of the dissolved partnership are alsocreditors of the person or partnership so continuing thebusiness.
3. When any partner retires or dies and the business of thedissolved partnership is continued as set forth in subsections 1and 2 of this section, with the consent of the retired partnersor the representative of the deceased partner, but without anyassignment of his right in partnership property, rights ofcreditors of the dissolved partnership and of the creditors ofthe person or partnership continuing the business shall be as ifsuch assignment had been made.
4. When all the partners or their representatives assigntheir rights in partnership property to one or more third personswho promise to pay the debts and who continue the business of thedissolved partnership, creditors of the dissolved partnership arealso creditors of the person or partnership continuing thebusiness.
5. When any partner wrongfully causes a dissolution and theremaining partners continue the business under the provisions ofsubdivision (2) of subsection 2 of section 358.380, either aloneor with others, and without liquidation of the partnershipaffairs, creditors of the dissolved partnership are alsocreditors of the person or partnership continuing the business.
6. When a partner is expelled and the remaining partnerscontinue the business either alone or with others, withoutliquidation of the partnership affairs, creditors of thedissolved partnership are also creditors of the person orpartnership continuing the business.
7. The liability of a third person becoming a partner in thepartnership continuing the business, under this section, to thecreditors of the dissolved partnership shall be satisfied out ofpartnership property only.
8. When the business of a partnership after dissolution iscontinued under any conditions set forth in this section thecreditors of the dissolved partnership, as against the separatecreditors of the retiring or deceased partner or therepresentative of the deceased partner, have a prior right to anyclaim of the retired partner or the representative of thedeceased partner against the person or partnership continuing thebusiness, on account of the retired or deceased partner'sinterest in the dissolved partnership or on account of anyconsideration promised for such interest or for his right inpartnership property.
9. Nothing in this section shall be held to modify any rightof creditors to set aside any assignment on the ground of fraud.
10. The use by the person or partnership continuing thebusiness of the partnership name, or the name of a deceasedpartner as part thereof, shall not of itself make the individualproperty of the deceased partner liable for any debts contractedby such person or partnership.
(L. 1949 p. 506 § 41)