J-A09039-19

2019 PA Super 174

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* Retired Senior Judge assigned to the Superior Court.

STEPHEN RATNER AND AUDREY 

RATNER AND DR. ROBERT 

OSTOYICH 

Appellants

v.

IRON STONE REAL ESTATE FUND I, 

L.P. AND IRON STONE REAL ESTATE 

GROUP I, LLC AND ANDREW V. 

EISENSTEIN

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 IN THE SUPERIOR COURT OF

 PENNSYLVANIA

 No. 3347 EDA 2018

Appeal from the Order Entered October 1, 2018

In the Court of Common Pleas of Philadelphia County Civil Division at 

No(s): No. 01497 March Term, 2017

BEFORE: KUNSELMAN, J., MURRAY, J., and PELLEGRINI*, J.

OPINION BY PELLEGRINI, J.: FILED MAY 29, 2019

This is an appeal by Stephen Ratner, Audrey Ratner and Dr. Robert 

Ostoyich (collectively, Limited Partners) from an order of the Court of 

Common Pleas of the First Judicial District (trial court) denying its request 

for summary judgment to find Iron Stone Real Estate Fund I, L.P. (Iron 

Stone LP or the Partnership) in dissolution while granting Iron Stone Real 

Estate Group I, LLC (Iron Stone LLC or the General Partner) and Andrew V. 

Eisenstein (Manager Eisenstein) (collectively, the Iron Stone) finding that 

the eight year extension of Iron Stone LP was valid under the partnership 

agreement. For reasons set forth in this Opinion, we affirm certain aspects 

of the summary judgment order, but reverse the decision dismissing the 
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claim for dissolution of the Limited Partnership and remand to the trial court 

to order the dissolution in accordance with the Pennsylvania Uniform 

Limited Partnership Act.

I.

A.

We take the following factual background and procedural history from 

our review of the certified record. On August 17, 2005, a Certificate of Limited 

Partnership was filed with the Secretary of State of the Commonwealth of 

Pennsylvania to form a limited partnership named Iron Stone Real Estate Fund 

I, L.P. (Partnership) under the Pennsylvania Revised Uniform Limited 

Partnership Act, as amended. See 15 Pa.C.S. §§ 8501-8594 (Repealed). On 

February 28, 2006, Iron Stone LLC entered into “An Agreement of Limited 

Partnership of the Iron Stone Real Estate Fund I, L.P.” (Limited Partnership 

Agreement).1 Section 3 of the Limited Partnership Agreement provided the 

purpose of Limited Partnership “to acquire, hold, maintain, operate, develop, 

sell, improve, lease, license, pledge, encumber, dispose of and otherwise 

invest in, directly or indirectly, real estate and related assets.” (R. 0028a).

Stephen Ratner and Audrey Ratner purchased two units out of 100 (a 

2% ownership interest for a total of $200,000). Dr. Robert Ostoyich 

____________________________________________

1 The Limited Partnership Agreement is at R. 0027a–to R. 0067a.
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purchased one unit out of 100 (a 1% ownership interest for $100,000) as 

limited partners in Iron Stone LP, who was the general partner.2

Section 4 of the Partnership Agreement provided that the term of the 

Partnership is “until December 31, 2015, unless earlier terminated in 

accordance with this Agreement or unless extended in the sole discretion of 

the General Partner for one or more of two additional consecutive periods of 

one year each.” Pursuant to this provision, prior to the December 31, 2013 

initial termination date, Defendant Iron Stone LLC as General Partner 

unilaterally extended the term of the Partnership Agreement for the two 

additional one-year periods, i.e. from December 31, 2013, to December 31,

2015.

At the expiration of the term of the Partnership, Section 10 of the 

Partnership Agreement governed how the Limited Partnership would be 

dissolved. It provides, in relevant part:

10.1. Dissolution

(a) The Partnership shall be dissolved and its affairs wound up 

upon the happening of any of the following events:

***

(iv) The expiration of the term (as the same may be 

extended hereunder) of the Partnership;

____________________________________________

2 Each unit was purchased for $100,000. There were 100 units purchased so 

Iron Stone LP’s fund totaled $10 million. (R.R. 541a; 872a).
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(b) After dissolution of the Partnership, the Partnership shall not 

terminate until the Partnership’s Certificate of Limited Partnership 

shall have been canceled and the assets of the Partnership shall 

have been distributed. . . Notwithstanding dissolution of the 

Partnership, prior to the termination of the Partnership as 

aforesaid, the business of the Partnership and the affairs 

of the Partners, as such, shall continue to be governed by 

this Agreement. (Emphasis added)

B.

On April 25, 2016, four months after the expiration of the term of the 

Agreement, Iron Stone LP sent a “Memorandum to Limited Partners” stating 

in relevant part: “We are writing to let you know about the next steps for 

Iron Stone Real Estate Fund I, L.P. (‘Fund’). The fund was established in 

March 2006 with the expectation that all investments would be sold and the 

partnership unwound by the end of 2015. But given the current status of 

Falls Center, the Fund’s largest remaining investment, we believe the correct 

course is to extend the term of the fund for an additional eight (8) years.”

(R. 0069a-0071a).

After detailing the reasons why Iron Stone LP believed this extension 

was in the best interests of all of the limited partners, the “Memorandum to 

Limited Partners" concluded: “We understand that this is a significant change 

to the plan we began with in 2006. But after managing the Fund’s portfolio, 

and Falls Center in particular, through the 2008 economic crisis we have 

positioned the remainder the portfolio for a positive outcome. We believe 

that staying the course is the smart way to go.” (R. 0071a).
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Each limited partner was given a copy of the proposed amendment and 

a written consent form to sign and return. The consent form stated “this 

Unanimous Written Consent may be executed by any number of counterparts 

each of whom shall be an original. . .” (R. 0072a).

This vote extending the term of the partnership was purportedly 

authorized and conducted pursuant to Paragraph 15.1. titled “Amendment.” 

It provides, in relevant part:

(a) No alteration, modification or amendment of this Agreement

shall be made unless in writing and signed (in counterpart or 

otherwise) by the General Partner and non -defaulting Limited 

Partners holding at least a majority of the outstanding Units held 

by non-defaulting Limited Partners, except that no alteration, 

modification or amendment of any section hereof which would 

materially and adversely affect the economic interests of one or 

more (but not all) of the non-defaulting limited Partners may be 

made (except as provided below) without the unanimous consent 

of all non-defaulting Limited Partners so adversely affected. An 

alteration, modification or amendment of any Section of this 

Agreement that materially and adversely affects the economic 

interests of all Limited Partners, as a class, may be made with the 

consent of the General Partner and Limited Partners holding 66% 

of the outstanding (hits bold by Limited Partners (including Units 

held by affiliates of the General Partner), except that no increase 

in the amount required to be contributed to the Partnership by the 

Limited Partners, other than as required herein or under applicable 

law, may be made without the consent of all the Limited Partners.

* * *

(c) Except as otherwise expressly provided for herein, whenever 

the General Partner desires to take any action which requires the 

consent or approval of all or a portion of the Limited Partners, the 

General Partner shall give written notice thereof (delivered in 

accordance with the requirements of Section 15.2 hereof) to each 

Partner from which any consent or approval is required describing 

the proposed action. As soon as practicable thereafter, each such 

Partner shall give the General Partner written notice (delivered in 
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accordance with the requirements of Section 15.2 hereof) that 

such Partner either consents to or approves or does not consent 

to or approve the proposed action. In the event that any such 

Partner fails to respond (as provided herein) on or before the 30th

day following notice, as provided herein, of any such proposed 

action by the 30th day following notice that Partner shall be 

conclusively presumed to have consented to or approved such 

action.

Each of the three Limited Partners voted to reject the extension of the 

duration of the Partnership because, among other reasons, a request for an 

extension occurred after the expiration.

Of all the Limited Partners who actually voted, over 66% of the Limited 

Partners voted to extend or abstained from voting to subsequently extend the 

Partnership for an additional eight years. However, only 34.75% of the 

Limited Partners returned ballots agreeing to extend the Partnership and,

thus, 65.25% of the Limited Partners either did not vote to extend or voted 

against the extension. (R. 001047a). Based on that vote, Iron Stone claimed 

that the term of the Partnership was extended through December 31, 2023. 

(R.0012a). Iron Stone LLC, acting as the general partner, executed the 

proposed amendment and extended the term of Iron Stone LP eight years.

C.

After their demand for payment of the value of their units, for an 

accounting of the value of their “units” and/or for the proper dissolution of the 

Partnership was refused, the Limited Partners filed a Complaint, later 

amended, and not as a derivative action brought on behalf of Iron Stone LP 

and/or the Limited Partners, as a class. (R.R. 543a). The Amended Complaint 
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asserted six causes of action alleging Breach of Fiduciary Duty (Count I), 

Breach of Implied Duty of Good Faith and Fair Dealing (Count II), Breach of 

Contract (Count III), Accounting (Count IV), Dissolution of Partnership (Count 

V) and Conversion (Count VI).

Underlying all of Limited Partners’ claims was the manner by which the 

Limited Partnership Agreement was purportedly extended. They claimed that 

the vote to extend the Partnership Agreement was ineffective because it was 

not requested until after the limited partnership had expired; if the vote could 

have taken place, the vote to extend did not pass because it required

unanimous consent because it would affect the rights of individual limited 

partners differently; and if it was not required to pass unanimously, then the 

vote count was faulty.

As to the other counts not dealing with the extension of the term of the 

limited partnership, they contended that because Manager Eisenstein, as 

managing partner, receives a management fee and/or salary from the 

management of the Partnership and, therefore, benefits individually from the 

improper continuation of the Partnership, breached the implied covenant of 

good faith and fair dealing each owed to the Plaintiffs causing them great 

financial loss. They also demanded an accounting and dissolution of the 

Partnership.
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D.

On preliminary objections, the trial court dismissed the Limited 

Partnership’s claims for breach of the implied duty of good faith and fair 

dealing and conversion. After the close of the pleadings, cross-motions for 

summary judgment were filed. Iron Stone sought dismissal of the remaining 

counts for breach of contract, breach of fiduciary duty, accounting and 

dissolution because the Limited Partners did not have standing to maintain 

those claims because they were derivative in nature and that the duration of 

the contract had been properly extended. In its cross-motion for summary 

judgment, the Limited Partners maintained the opposite but only sought 

dissolution of the Partnership.3 The trial court granted Iron Stone LP’s motion

and denied the Limited Partners’ motion for summary judgment.

In doing so, the trial court found that the breach of contract claim could 

not be sustained because the Iron Stone LP partnership term was extended in 

accordance with the Partnership Agreement because 66.67% of the Limited 

Partners consented to the extension of Iron Stone LPs’ term in accordance 

with Paragraph 15.1(a) of the Partnership Agreement. It also stated that it 

____________________________________________

3 Due to significant disputes during discovery, a discovery master was 

appointed to prevent turnover of the Limited Partners’ personal financial 

information, the trial court granted Limited Partners’ request that precluded 

them from seeking damages from the Defendants other than the value of their 

interests in the Partnership.
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“does not find persuasive plaintiffs’ relevance upon the term ‘unanimous’ on 

the consent form for the required vote.” (Trial Court Opinion at 4.)

The trial court further found that Plaintiffs cannot recover under their 

Breach of Fiduciary Duty claim because (1) the “extension of Iron Stone, LP 

was proper” and (2) the damages alleged are derivative in nature and not 

personal to them.” (Id. at 4-5). Finally, the trial court found that “[s]ince 

the claims for dissolution and accounting are also derivative in nature and not 

personal to them, the claims for dissolution and accounting are dismissed.” 

(Id. at 5). After their Petition for Reconsideration was denied, the Limited 

Partners took this appeal.4

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4 “Our scope of review of summary judgment orders is plenary. We apply the 

same standard as the trial court, reviewing all the evidence of record to 

determine whether there exists a genuine issue of material fact. We view the 

record in the light most favorable to the non-moving party, and all doubts as 

to the existence of a genuine issue of material fact must be resolved against 

the moving party. Only where there is no genuine issue as to any material 

fact and it is clear that the moving party is entitled to judgment as a matter 

of law will summary judgment be entered.

Motions for summary judgment necessarily and directly implicate the 

plaintiffs’ proof of the elements of their cause of action. Summary judgment 

is proper if, after the completion of discovery relevant to the motion, including 

the production of expert reports, an adverse party who will bear the burden 

of proof at trial has failed to produce evidence of facts essential to the cause 

of action or defense which in a jury trial would require the issues to be 

submitted to a jury. Thus, a record that supports summary judgment will 

either (1) show the material facts are undisputed or (2) contain insufficient 

evidence of facts to make out a prima facie cause of action or defense and, 

therefore, there is no issue to be submitted to the jury. Upon appellate review,

we are not bound by the trial court’s conclusions of law, but may reach our 

own conclusions. The appellate Court may disturb the trial court’s order only 
J-A09039-19

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II.

Initially, we must address whether the Limited Partners lack standing 

to maintain this action because those claims are derivative and not personal 

to them.

Under Pennsylvania law, a partner in a limited partnership has standing 

to personally assert a direct action against another partner if he has sustained 

“an actual or threatened injury that is not solely the result of an injury 

suffered or threatened to be suffered by the limited partnership.” 15 Pa.C.S. 

§ 8691(b). However, “[w]hen a limited partner alleges wrongs to the limited 

partnership that indirectly damaged a limited partner by rendering his 

contribution or interest in the limited partnership valueless, the limited 

partner is required to bring his claim derivatively on behalf of the 

partnership.” Weston v. Northampton Pers. Care, Inc., 62 A.3d 947, 957 

(Pa. Super. 2013) (quotation marks omitted). In those circumstances, “such 

a claim belongs to, and is an asset of, the corporation.” Hill v. Ofalt, 85 A.3d 

540, 548 (Pa. Super. 2014).5

____________________________________________

upon an error of law or an abuse of discretion.” Alexander v. City of 

Meadville, 61 A.3d 218, 221 (Pa. Super. 2012) (quotation omitted).

5 15 Pa.C.S. § 8692 deals with derivative actions. It is the opposite of a direct 

action in that the harms are done to the limited partnership as a whole, not 

mainly affecting the individual partner. To bring a derivative action “the 

partner first makes a demand on the general partners requesting that they 

cause the partnership to bring an action to enforce the right” seeking to be 

rectified. If the general partner refuses to bring such an action, permits a 
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Anglo Am. Sec. Fund, L.P. v. S.R. Glob. Int’l Fund, L.P., 829 A.2d 

143, 150 (Del. Ch. 2003) 6restated those principle and provided a test as to 

how to determine whether a claim is direct or derivative. It stated:

The test looks to the nature of the injury and to the nature of 

remedy that could result if the plaintiffs are successful. When a 

plaintiff alleges either an injury that is different from what is 

suffered by other shareholders (or partners) or one that involves 

a contractual right of shareholders (or partners) that is 

independent of the entity’s rights, the claim is direct. If the injury 

is one that affects all partners proportionally to their pro rata 

interests in the corporation, the claim is derivative. In a derivative 

action the plaintiff sues for an injury done to the partnership and 

____________________________________________

limited partner to bring a derivative action. Section 8692(a). See Official

Comment to 15 Pa.C.S. § 8692 (“By its terms, this section permits a general 

partner as well as a limited partner to bring a derivative action.”).

6 “Section 1927 of the Statutory Construction Act directs that, “[s]tatutes 

uniform with those of other states shall be interpreted and construed to affect

their general purpose to make uniform the laws of those states which enact 

them.” 1 Pa.C.S. § 1927. Although statutes, commentary and decisions of 

our sister states are certainly not binding on this Court, it is important in 

construing a uniform act to recognize how those states have interpreted 

similar provisions. See Sternlicht v. Sternlicht, 583 Pa. 149, 876 A.2d 904, 

911 n. 13 (2005) (“[I]n construing a uniform law, this Court must consider 

the decisions of our sister states who have adopted and interpreted such 

uniform law and must afford these decisions great deference.”); Continental 

Ins. Co. v. Schneider, Inc., 582 Pa. 591, 873 A.2d 1286, 1294 n. 10 (2005) 

(“Although these cases involved other jurisdictions’ versions of the UCC, they 

are nevertheless persuasive authority here as the relevant provisions in their 

UCC statutes are substantially similar to the provisions in the Pennsylvania 

UCC[.]”); Commonwealth v. National Bank & Trust Co. of Central 

Pennsylvania, 469 Pa. 188, 364 A.2d 1331, 1335 (1976) (“While it is a 

truism that decisions of sister states are not binding precedent on this Court, 

they may be persuasive authority, ... and are entitled to even greater 

deference where consistency and uniformity of application are essential 

elements of a comprehensive statutory scheme like that contemplated by the 

Uniform Commercial Code.”) (citations omitted. Koken v. Reliance Ins. Co.,

893 A.2d 70, 83 (Pa. 2006).
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any recovery of damages is paid to the partnership. Conversely, 

in a direct action the plaintiff sues to redress an injury suffered by 

the individual plaintiff and damages recovered are paid directly to 

the plaintiff who was injured. (footnotes omitted.)

In this case, in their six count Complaint, the Limited Partners make 

two types of claims. In Count I, Breach of Fiduciary Duty; Count II, Breach 

of Implied Duty of Good Faith and Fair Dealing; and Count IV, Conversion,

they maintain, among other things, that Manager Eisenstein improperly made 

multi-million dollar loans to related parties; that he received millions of dollars 

in improper administrative and management fees; and that he was being paid 

excessively. In each of those counts they sought damages for the alleged 

improper dealings.

Those counts are clearly derivative because they claim that the General 

Partner and Manager Eisenstein received improper payments, making any 

damages due to the Limited Partnership and not to Limited Partners, even 

though they may be incidentally affected. Because the injury claimed in those 

counts affects all partners proportionally to their pro rata interests in the 

corporation, they are derivative and the Limited Partners do not have 

standing to maintain those counts.

However, those counts that set forth Breach of Contract (Count III,) 

Accounting (Count IV), and Dissolution of Partnership (Count V), the Limited 

Partners are claiming that the General Partner Iron Stone LLC refused to wind 

up the affairs of the Limited Partnership because under the Limited Partnership 

Agreement, it was in dissolution, as well as access to its financial records. 
J-A09039-19

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These are types of breaches to the partnership agreement that injures a 

partner in a way that is not incidental to an injury to the partnership allowing 

for a direct action to be brought by the injured limited partner.

In Anglo Am. Sec. Fund, the Delaware court also stated: “When a 

plaintiff alleges ... an injury ... that involves a contractual right of shareholders 

(or partners) that is independent of the entity’s rights, the claim is direct.” 

See Anglo American, 829 A.2d at 150. See also Ionosphere Clubs, Inc. 

v. American National Bank & Trust Company of Chicago, 17 F.3d 600, 

605 (2nd Cir. 1994); see also Callison and Sullivan, Partnership Law and 

Practice: General and Limited Partnerships § 28.3 (2004) (noting that a direct 

action is appropriate “to enforce the right to inspect limited partnership books 

and records, to compel distributions required by the limited partnership 

agreement, to enforce voting rights, and to compel dissolution of the limited 

partnership.)

Because in counts seeking dissolution and accounting (Counts III, IV 

and V), the Limited Partners are seeking the enforcement of their individual 

rights and return of monies individually to them as required under the Limited 

Partnership Agreement and/or the Limited Partnership Act, and this is a direct 

action within the meaning of 15 Pa.C.S. § 8691(b) and the Limited Partners 

have standing to maintain those counts.

Now to the merits.
J-A09039-19

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III.

Central to the resolution of this appeal is whether the trial court erred 

in holding that the Partnership Agreement was properly extended. There is 

no dispute that a vote taken pursuant to Section 15.1 to amend the 

Partnership Agreement to extend its duration prior to its December 31, 2015 

termination date would have been permissible. The question is whether the 

duration of the Partnership Agreement can be extended after the Partnership 

had expired.7

The Limited Partners contend that the duration of the Partnership 

cannot be extended because Section 10.1 (iv) of the Partnership Agreement 

provides that the partnership “shall be dissolved and its affairs wound up” on 

December 31, 2015, the expiration of the term of the Partnership. This is 

bolstered by 15 Pa.C.S. § 8681(1) that states “A limited partnership is 

dissolved, and its activities and affairs must be wound up,” when “an event 

____________________________________________

7 Like the trial court, we do not find persuasive the Limited Partners’ argument 

that the term “unanimous" on the consent form to be in any way 

determinative. The Partnership Agreement provides the percentage of the 

vote to be required and that cannot be altered by the consent form. No 

argument is made that the voters were in any way mislead by this mistake. 

Moreover, because their reasons are merely speculative, we also find 

unpersuasive the Limited Partners’ argument that the requisite votes were 

not received to extend the duration of the Limited Partnership, if the Limited 

Partnership could be extended while it was in dissolution. Finally, we note 

that the Limited Partners refer to 15 Pa.C.S. § 8353;15 Pa.C.S. § 8352, and 

15 Pa.C.S. § 8449 in support of its position. We note that those provisions 

are inapplicable because they apply to partnerships and not limited 

partnerships.
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or circumstance that the partnership agreement states causes dissolution.” 

After that date, they contend, the duration of the Partnership cannot be 

extended because it is in dissolution.

Iron Stone contends, however, that under Section 15.1 of the 

Partnership Agreement, the duration of the Partnership can be extended even 

after an event occurs that the Partnership Agreement triggers dissolution. 

Section 10.1 of the Partnership Agreement does provide:

Notwithstanding dissolution of the Partnership, prior to the 

termination of the Partnership as aforesaid, the business of the 

Partnership and the affairs of the Partners, as such, shall continue 

to be governed by this Agreement.

Iron Stone also points to the Official Comment to 15 Pa.C.S. § 8681, 

which states, in relevant part:

In some circumstances, an amendment to the limited partnership 

agreement might avert dissolution--e.g., by revising an agreedupon deadline for selling the partnership assets and winding up 

the business. A retroactive amendment may also be possible. 

See Kindred Ltd. P'ship v. Screen Actors Guild, Inc., 

CV082220PSGPJWX, 2009 WL 279080 at *5-6 (C.D. Cal. Feb. 3, 

2009) (giving effect to an amendment that retroactively 

eliminated an event of dissolution).

This Comment is a direct lift from the official comments to Section 801 

of the Uniform Limited Partnership Act of 2013. Unif.Ltd.Part.Act 2013 § 801. 

Iron Stone concludes by saying that under both the Partnership Agreement 

and 15 Pa.C.S. § 8681, duration of the Partnership can be extended beyond 

the agreed date of dissolution, i.e. December 31, 2015, for eight additional 

years, i.e. December 31, 2023.
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To answer whether the Partnership can be extended after a date that 

the Partnership and Agreement was extended, it is necessary to examine 

whether there is anything in the Limited Partnership Act that would preclude 

extension of the duration of the Partnership and how it varies from the 

Uniform Partnership Act of 2016.

A limited partnership is governed by both the terms of the Partnership 

Agreement as well as the laws regarding limited partnerships. See 15 

Pa.C.S.A. § 8611; 15 PaC.S. § 8616. While this Limited Partnership was 

formed under the Pennsylvania Revised Uniform Limited Partnership Act, the 

Revised Act was superseded by the Pennsylvania Uniform Limited Partnership 

Act of 2016. 15 Pa.C.S. § 8611-8695. This Act adopted, with an omission

important here, the Uniform Limited Partnership Act 2013. With several

exceptions, the Pennsylvania Uniform Limited Partnership Act of 2016

governs and regulates the conduct of all limited partnerships in Pennsylvania

even though they were formed prior to its effective date. 5 Pa.C.S. § 

8611(c.).8

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8 One of those exceptions set forth in 5 Pa.C.S. § 8611 (d) states that “Section 

8620(c) (relating to characteristics of limited partnership) does not apply and 

the limited partnership has whatever duration it had under the law applicable 

immediately before February 21, 2017.” Section 8620(c) provides that “A 

limited partnership has perpetual duration.” However, there is nothing in the 

Act that forbids the Partnership from varying this provision and have for a 

definite set of terms. 15 Pa.C.S. § 8615.
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Generally, the partnership agreement governs the duties, rights and 

obligation of the parties. There are however, some provisions of the Act that 

a partnership agreement may not vary. Pertinent here, 15 Pa.C.S. § 

8615(c)(16) provides that a partnership agreement may not “[v]ary the 

requirements to wind up the partnership’s activities and affairs specified in 

section 8682(a), (b)(1), (d) and (e) (relating to winding up and filing of 

certificates).” Of those subsections, only 15 Pa.C.S. § 8682(a) is pertinent. 

It provides that “[a] dissolved limited partnership shall wind up its activities 

and affairs and the partnership continues after dissolution only for the 

purpose of winding up.” Id.

As to the question of recession of the dissolution, the Limited 

Partnership Act is silent. This is unlike the Uniform Partnership Act of 2013

upon which the Limited Partnership Act is based. The Unif.Ltd.Part.Act 2013 

§ 803 specifically provides that dissolution can be rescinded with the 

affirmative vote of each partner.9 When adopting the Limited Partnership Act, 

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9 Unif.Ltd.Part.Act 2013, § 803, provides that:

(a) A limited partnership may rescind its dissolution, unless a 

statement of termination applicable to the partnership has 

become effective, [the appropriate court] has entered an 

order under Section 801(a)(6) dissolving the partnership, or 

the [Secretary of State] has dissolved the partnership under 

Section 811.

(b) Rescinding dissolution under this section requires:
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our General Assembly did not adopt this provision; instead, at 15 Pa.C.S. § 

803 where this provision would have been adopted, it just states “Reserved.”

This leads us back to the Comment to 15 Pa.C.S. § 8681 which is a 

direct lift from the Official Comment to the Unif.Ltd.Part.Act 2013 § 801. That 

Comment cites to Kindred Ltd. P’ship v. Screen Actors Guild, Inc.,

CV082220PSGPJWX, 2009 WL 279080 at *5-6 (C.D. Cal. Feb. 3, 2009), an 

unreported federal district court case. One of the subsidiary issues in that 

case was whether a 2008 amendment to the partnership agreement was valid 

____________________________________________

(1) the affirmative vote or consent of each partner; and

(2) if the limited partnership has delivered to the [Secretary of 

State] for filing an amendment to the certificate of limited 

partnership stating that the partnership is dissolved and:

(A) the amendment has not become effective, delivery to the 

[Secretary of State] for filing of a statement of withdrawal 

under Section 208 applicable to the amendment; or

(B) the amendment has become effective, delivery to the 

[Secretary of State] for filing of an amendment to the 

certificate of limited partnership stating that dissolution has 

been rescinded under this section.

(c) If a limited partnership rescinds its dissolution:

(1) the partnership resumes carrying on its activities and affairs 

as if dissolution had never occurred;

(2) subject to paragraph (3), any liability incurred by the 

partnership after the dissolution and before the rescission has 

become effective is determined as if dissolution had never 

occurred; and

(3) 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.
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so as to prevent immediate dissolution on June 21, 1989, and default. The 

resolution of that question involved Cal. Corp. Code § 16802(b), a provision 

similar to the Unif.Ltd.Part.Act 2013 § 803, which provides:

At any time after the dissolution of a partnership and before the 

winding up of its business is completed, all of the partners, 

including any dissociating partner other than a wrongfully 

dissociating partner, may waive the right to have the partnership’s 

business wound up and the partnership terminated. In that event 

both of the following apply:

(1) The partnership resumes carrying on its business as if 

dissolution had never occurred, and any liability incurred by the 

partnership or a partner after the dissolution and before the 

waiver is determined as if dissolution had never occurred.

(2) The rights of a third party accruing under paragraph (1) 

of Section 16804 or arising out of conduct in reliance on the 

dissolution before the third party knew or received a notification 

of the waiver may not be adversely affected.

The district court held that because California law allows partners to 

cancel dissolution “at any time,” and that in the event of dissolution, the 

cancellation is retroactive, that when all the limited partners voted to rescind 

the dissolution, such dissolution is deemed never to have occurred. Because, 

unlike California and the Uniform Limited Partnership Act, the Pennsylvania 

Limited Partnership Act does not contain a provision regarding recession of 

the dissolution, the Comment to 15 Pa.C.S. § 8681 has no application. It also 

means that the Pennsylvania Limited Partnership Act does not provide for 

recession of dissolution of a limited partnership.

In conclusion:
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 15 Pa.C.S. § 8681(1) states that “A limited partnership is 

dissolved, and its activities and affairs must be wound up,” when 

“an event or circumstance that the partnership agreement states 

causes dissolution.” 

 Section 10.1 (a)(iv) of the Partnership Agreement provides 

that the Partnership shall be dissolved and its affairs wound up at 

the expiration of the term of the Partnership, i.e. December 31, 

2015.

 That means after December 31, 2015, under the terms of 

the Partnership Agreement, the Partnership went into dissolution.

 After a partnership goes into dissolution, 15 Pa.C.S. § 

8615(c)(16) provides that a partnership agreement cannot vary 

the requirements for winding up a dissolved partnership set forth 

at 15 Pa.C.S. § 8682(a), which provides that the dissolved 

partnership only exists for the purpose of winding up.

 Because a partnership agreement may not vary the 

requirements to wind up the partnership’s activities and affairs 

specified in section 8682(a), Section 10.1 of the Partnership 

Agreement that allows for retroactive recession of the dissolution 

of the corporation is inoperative.

 Moreover, because nothing in the Pennsylvania Uniform 

Partnership Act authorizes recession of a dissolution of a Limited 

Partnership, then the vote to retroactively extend the duration 

was ineffective.

Accordingly, the trial court’s granting of that portion of Iron Stone’s 

motion for summary judgment dismissing Limited Partners’ Count I, Breach 

of Fiduciary Duty; Count II, Breach of Implied Duty of Good Faith and Fair 

Dealing, and Count VI, Conversion of the Complaint as being derivative is 

affirmed. However, that portion of the trial court’s order dismissing Count IV, 

Breach of Contract, Count V, Dissolution of Partnership and Count III, 

Accounting, as well as the trial court’s denial of the Limited Partnership’s claim 
J-A09039-19

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seeking to have the General Partners begin winding up the affairs of the 

Limited Partnership are reversed. The matter is remanded to the trial court 

to enter an order that the Limited Partnership shall wind up its activities and 

affairs in accordance with 15 Pa.C.S. § 8682.

Case remanded with instructions. Jurisdiction relinquished.

Judgment Entered.

Joseph D. Seletyn, Esq.

Prothonotary

Date: 5/29/19