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4-46-603. Effect of partner's dissociation.
Arkansas Code — all titles (historical 2020) · legal_authorities
4-46-603. Effect of partner's dissociation.
(a) If a partner's dissociation results in a dissolution and winding up of the partnership business, § 4-46-801 et seq. applies; otherwise, § 4-46-701 et seq. applies.
(b) Upon a partner's dissociation:
(1) the partner's right to participate in the management and conduct of the partnership business terminates, except as otherwise provided in § 4-46-803;
(2) the partner's duty of loyalty under § 4-46-404(b)(3) terminates; and
(3) the partner's duty of loyalty under § 4-46-404(b)(1) and (2) and duty of care under § 4-46-404(c) continue only with regard to matters arising and events occurring before the partner's dissociation, unless the partner participates in winding up the partnership's business pursuant to § 4-46-803.
Source: Arkansas Code — historical release 78 (November 6, 2020) · 4-46-603
Stored review status: Historical 2020-11-06 source release; later amendments not reconciled; machine-extracted, not independently legally reviewed; source heading status: text_in_historical_source. A text match is a research starting point; applicability is not established.
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Stable record: arkansas_code:legal_authorities:4-46-603
Source file: gov.ar.code.title.04.odt
Pages: Not recorded – Not recorded
Passage SHA-256: 1a4b2d5ac72cfdcd25eec8f5c178fa2bcc21420991538e7fa983926680b38a64
Source location: content.xml paragraph 26525
Stored source content
4-46-603. Effect of partner's dissociation.
(a) If a partner's dissociation results in a dissolution and winding up of the partnership business, § 4-46-801 et seq. applies; otherwise, § 4-46-701 et seq. applies.
(b) Upon a partner's dissociation:
(1) the partner's right to participate in the management and conduct of the partnership business terminates, except as otherwise provided in § 4-46-803;
(2) the partner's duty of loyalty under § 4-46-404(b)(3) terminates; and
(3) the partner's duty of loyalty under § 4-46-404(b)(1) and (2) and duty of care under § 4-46-404(c) continue only with regard to matters arising and events occurring before the partner's dissociation, unless the partner participates in winding up the partnership's business pursuant to § 4-46-803.
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Arkansas Code — all titles (historical 2020) · legal_authorities
4-46-404. General standards of partner's conduct.
(a) The only fiduciary duties a partner owes to the partnership and the other partners are the duty of loyalty and the duty of care set forth in subsections (b) and (c) of this section.
(b) A partner's duty of loyalty to the partnership and the other partners is limited to the following:
(1) to account to the partnership and hold as trustee for it any property, profit, or benefit derived by the partner in the conduct and winding up of the partnership business or derived from a use by the partner of partnership property, including the appropriation of a partnership opportunity;
(2) to refrain from dealing with the partnership in the conduct or winding up of the partnership business as or on behalf of a party having an interest adverse to the partnership; and
(3) to refrain from competing with the partnership in the conduct of the partnership business before the dissolution of the partnership.
(c) A partner's duty of care to the partnership and the other partners in the conduct and winding up of the partnership business is limited to refraining from engaging in grossly negligent or reckless conduct, intentional misconduct, or a knowing violation of law.
(d) A partner shall discharge the duties to the partnership and the other partners under this chapter or under the partnership agreement and exercise any rights consistently with the obligation of good faith and fair dealing.
(e) A partner does not violate a duty or obligation under this chapter or under the partnership agreement merely because the partner's conduct furthers the partner's own interest.
(f) A partner may lend money to and transact other business with the partnership, and as to each loan or transaction the rights and obligations of the partn
Source: Arkansas Code — historical release 78 (November 6, 2020) · 4-46-404
Stored review status: Historical 2020-11-06 source release; later amendments not reconciled; machine-extracted, not independently legally reviewed; source heading status: text_in_historical_source. The source passage cites 4-46-404. This identifies an authority to review, not proof of applicability.
Arkansas Code — all titles (historical 2020) · legal_authorities
4-46-701. Purchase of dissociated partner's interest.
(a) If a partner is dissociated from a partnership without resulting in a dissolution and winding up of the partnership business under § 4-46-801, the partnership shall cause the dissociated partner's interest in the partnership to be purchased for a buyout price determined pursuant to subsection (b) of this section.
(b) The buyout price of a dissociated partner's interest is the amount that would have been distributable to the dissociating partner under § 4-46-807(b) if, on the date of dissociation, the assets of the partnership were sold at a price equal to the greater of the liquidation value or the value based on a sale of the entire business as a going concern without the dissociated partner and the partnership were wound up as of that date. Interest must be paid from the date of dissociation to the date of payment.
(c) Damages for wrongful dissociation under § 4-46-602(b), and all other amounts owing, whether or not presently due, from the dissociated partner to the partnership, must be offset against the buyout price. Interest must be paid from the date the amount owed becomes due to the date of payment.
(d) A partnership shall indemnify a dissociated partner whose interest is being purchased against all partnership liabilities, whether incurred before or after the dissociation, except liabilities incurred by an act of the dissociated partner under § 4-46-702.
(e) If no agreement for the purchase of a dissociated partner's interest is reached within one hundred twenty (120) days after a written demand for payment, the partnership shall pay, or cause to be paid, in cash to the dissociated partner the amount the partnership estimates to be the buyout price and accrued interest, reduced by any offsets a
Source: Arkansas Code — historical release 78 (November 6, 2020) · 4-46-701
Stored review status: Historical 2020-11-06 source release; later amendments not reconciled; machine-extracted, not independently legally reviewed; source heading status: text_in_historical_source. The source passage cites 4-46-701. This identifies an authority to review, not proof of applicability.
Arkansas Code — all titles (historical 2020) · legal_authorities
4-46-801. Events causing dissolution and winding up of partnership business.
A partnership is dissolved, and its business must be wound up, only upon the occurrence of any of the following events:
(1) in a partnership at will, the partnership's having notice from a partner, other than a partner who is dissociated under § 4-46-601(2)-(10), of that partner's express will to withdraw as a partner, or on a later date specified by the partner;
(2) in a partnership for a definite term or particular undertaking:
(i) within ninety (90) days after a partner's dissociation by death or otherwise under § 4-46-601(6)-(10) or wrongful dissociation under § 4-46-602(b), the express will of at least half of the remaining partners to wind up the partnership business, for which purpose a partner's rightful dissociation pursuant to § 4-46-602(b)(2)(i) constitutes the expression of that partner's will to wind up the partnership business;
(ii) the express will of all of the partners to wind up the partnership business; or
(iii) the expiration of the term or the completion of the undertaking;
(3) an event agreed to in the partnership agreement resulting in the winding up of the partnership business;
(4) an event that makes it unlawful for all or substantially all of the business of the partnership to be continued, but a cure of illegality within ninety (90) days after notice to the partnership of the event is effective retroactively to the date of the event for purposes of this section;
(5) on application by a partner, a judicial determination that:
(i) the economic purpose of the partnership is likely to be unreasonably frustrated;
(ii) another partner has engaged in conduct relating to the partnership business which makes it not reasonably practicable to carry on the bu
Source: Arkansas Code — historical release 78 (November 6, 2020) · 4-46-801
Stored review status: Historical 2020-11-06 source release; later amendments not reconciled; machine-extracted, not independently legally reviewed; source heading status: text_in_historical_source. The source passage cites 4-46-801. This identifies an authority to review, not proof of applicability.
Arkansas Code — all titles (historical 2020) · legal_authorities
4-46-803. Right to wind up partnership business.
(a) After dissolution, a partner who has not wrongfully dissociated may participate in winding up the partnership's business, but on application of any partner, partner's legal representative, or transferee, the court, for good cause shown, may order judicial supervision of the winding up.
(b) The legal representative of the last surviving partner may wind up a partnership's business.
(c) A person winding up a partnership's business may preserve the partnership business or property as a going concern for a reasonable time, prosecute and defend actions and proceedings, whether civil, criminal, or administrative, settle and close the partnership's business, dispose of and transfer the partnership's property, discharge the partnership's liabilities, distribute the assets of the partnership pursuant to § 4-46-807, settle disputes by mediation or arbitration, and perform other necessary acts.
Source: Arkansas Code — historical release 78 (November 6, 2020) · 4-46-803
Stored review status: Historical 2020-11-06 source release; later amendments not reconciled; machine-extracted, not independently legally reviewed; source heading status: text_in_historical_source. The source passage cites 4-46-803. This identifies an authority to review, not proof of applicability.