Delaware Code Title 6 Sec. 15-703 – Dissociated partner’s liability to other persons
(a) A partner‘s dissociation does not of itself discharge the partner’s liability for a partnership obligation incurred before dissociation. A dissociated partner is not liable for a partnership obligation incurred after dissociation, except as otherwise provided in subsection (b) of this section.
Terms Used In Delaware Code Title 6 Sec. 15-703
- Business: includes every trade, occupation and profession, the holding or ownership of property and any other activity for profit. See Delaware Code Title 6 Sec. 15-101
- Knowledge: means a person's actual knowledge of a fact, rather than the person's constructive knowledge of the fact. See Delaware Code Title 6 Sec. 17-101
- Obligation: An order placed, contract awarded, service received, or similar transaction during a given period that will require payments during the same or a future period.
- Partner: means a person who is admitted to a partnership as a partner of the partnership. See Delaware Code Title 6 Sec. 15-101
- Partnership: A voluntary contract between two or more persons to pool some or all of their assets into a business, with the agreement that there will be a proportional sharing of profits and losses.
- Partnership: means an association of 2 or more persons formed under § 15-202 of this title, predecessor law or comparable law of another jurisdiction to carry on any business, purpose or activity. See Delaware Code Title 6 Sec. 15-101
- Year: means a calendar year, and is equivalent to the words "year of our Lord. See Delaware Code Title 1 Sec. 302
(b) A partner who dissociates without resulting in a dissolution and winding up of the partnership business is liable as a partner to the other party in a transaction entered into by the partnership, or a surviving partnership under subchapter IX of this chapter, within 1 year after the partner’s dissociation, only if the partner is liable for the obligation under § 15-306 of this title and at the time of entering into the transaction the other party:
(1) Reasonably believed that the dissociated partner was then a partner and reasonably relied on such belief in entering into the transaction;
(2) Did not have notice of the partner’s dissociation; and
(3) Is not deemed to have had knowledge under § 15-303(c) of this title or notice under § 15-704(c) of this title.
(c) By agreement with the partnership creditor and the partners continuing the business, a dissociated partner may be released from liability for a partnership obligation.
(d) A dissociated partner is released from liability for a partnership obligation if a partnership creditor, with notice of the partner’s dissociation but without the partner’s consent, agrees to a material alteration in the nature or time of payment of a partnership obligation.