KRS § 362.350 — KY Code / Title XXIX / Chapter 362 / Section 362.350
362.350 Liability of persons continuing the business in certain cases
Status: in_force

362.350 Liability of persons continuing the business in certain cases.

(1) When any new partner is admitted into an existing partnership, or when any partner

retires and assigns (or the representative of the deceased partner assigns) his rights

in partnership property to two (2) or more of the partners, or to one (1) or more of

the partners and one (1) or more third persons, if the business is continued without

liquidation of the partnership affairs, creditors of the first or dissolved partnership

are also creditors of the partnership so continuing the business.

(2) When all but one (1) partner retire and assign (or the representative of a deceased

partner assigns) their rights in partnership property to the remaining partner, who

continues the business without liquidation of partnership affairs, either alone or

with others, creditors of the dissolved partnership are also creditors of the person or

partnership so continuing the business.

(3) When any partner retires or dies and the business of the dissolved partnership is

continued as set forth in subsections (1) and (2) of this section, with the consent of

the retired partners or the representative of the deceased partner, but without any

assignment of his right in partnership property, rights of creditors of the dissolved

partnership, and of the creditors of the person or partnership continuing the business

shall be as if such assignment had been made.

(4) When all the partners or their representatives assign their rights in partnership

property to one (1) or more third persons who promise to pay the debts and who

continue the business of the dissolved partnership, creditors of the dissolved

partnership are also creditors of the person or partnership continuing the business.

(5) When any partner wrongfully causes a dissolution and the remaining partners

continue the business under the provisions of paragraph (b) of subsection (2) of

KRS 362.335, either alone or with others, and without liquidation of the partnership

affairs, creditors of the dissolved partnership are also creditors of the person or

partnership continuing the business.

(6) When a partner is expelled and the remaining partners continue the business either

alone or with others, without liquidation of the partnership affairs, creditors of the

dissolved partnership are also creditors of the person or partnership continuing the

business.

(7) The liability of a third person becoming a partner in the partnership continuing the

business, under this section, to the creditors of the dissolved partnership shall be

satisfied out of partnership property only.

(8) When the business of a partnership after dissolution is continued under any

conditions set forth in this section the creditors of the dissolved partnership, as

against the separate creditors of the retiring or deceased partner or the representative

of the deceased partner, have a prior right to any claim of the retired partner or the

representative of the deceased partner against the person or partnership continuing

the business, on account of the retired or deceased partner's interest in the dissolved

partnership or on account of any consideration promised for such interest or for his

right in partnership property.

(9) Nothing in this section shall be held to modify any right of creditors to set aside any

assignment on the ground of fraud.

(10) The use by the person or partnership continuing the business of the partnership

name, or the name of a deceased partner as part thereof, shall not of itself make the

individual property of the deceased partner liable for any debts contracted by such

person or partnership.