SECTIONS 16501-16504 - California Statutes

CORPORATIONS CODE

SECTION 16501-16504

16501. A partner is not a coowner of partnership property and has
no interest in partnership property that can be transferred, either
voluntarily or involuntarily.

16502. The only transferable interest of a partner in the
partnership is the partner's share of the profits and losses of the
partnership and the partner's right to receive distributions. The
interest is personal property.

16503. (a) A transfer, in whole or in part, of a partner's
transferable interest in the partnership is permissible. However, a
transfer does not do either of the following:
(1) By itself cause the partner's dissociation or a dissolution
and winding up of the partnership business.
(2) As against the other partners or the partnership, entitle the
transferee, during the continuance of the partnership, to participate
in the management or conduct of the partnership business, to require
access to information concerning partnership transactions, or to
inspect or copy the partnership books or records.
(b) A transferee of a partner's transferable interest in the
partnership has a right to all of the following:
(1) To receive, in accordance with the transfer, distributions to
which the transferor would otherwise be entitled.
(2) To receive upon the dissolution and winding up of the
partnership business, in accordance with the transfer, the net amount
otherwise distributable to the transferor.
(3) To seek under paragraph (6) of Section 16801 a judicial
determination that it is equitable to wind up the partnership
business.
(c) In a dissolution and winding up, a transferee is entitled to
an account of partnership transactions only from the date of the
latest account agreed to by all of the partners.
(d) Upon transfer, the transferor retains the rights and duties of
a partner other than the interest in distributions transferred.
(e) A partnership need not give effect to a transferee's rights
under this section until it has notice of the transfer.
(f) A transfer of a partner's transferable interest in the
partnership in violation of a restriction on transfer contained in
the partnership agreement is ineffective as to a person having notice
of the restriction at the time of transfer.

16504. (a) On application by a judgment creditor of a partner or of
a partner's transferee, a court having jurisdiction may charge the
transferable interest of the judgment debtor to satisfy the judgment.
The court may appoint a receiver of the share of the distributions
due or to become due to the judgment debtor in respect of the
partnership and make all other orders, directions, accounts, and
inquiries the judgment debtor might have made or that the
circumstances of the case may require.
(b) A charging order constitutes a lien on the judgment debtor's
transferable interest in the partnership. The court may order a
foreclosure of the interest subject to the charging order at any
time. The purchaser at the foreclosure sale has the rights of a
transferee.
(c) At any time before foreclosure, an interest charged may be
redeemed in any of the following manners:
(1) By the judgment debtor.
(2) With property other than partnership property, by one or more
of the other partners.
(3) With partnership property, by one or more of the other
partners with the consent of all of the partners whose interests are
not so charged.
(d) This chapter does not deprive a partner of a right under
exemption laws with respect to the partner's interest in the
partnership.
(e) This section provides the exclusive remedy by which a judgment
creditor of a partner or partner's transferee may satisfy a judgment
out of the judgment debtor's transferable interest in the
partnership.