§ 14-8-41 - Relations with creditors following withdrawal, expulsion, or death of existing partners or assignment of partnership rights to third parties - Georgia Statutes

O.C.G.A. 14-8-41 (2010)
14-8-41. Relations with creditors following withdrawal, expulsion, or death of existing partners or assignment of partnership rights to third parties

(a) When any partner withdraws, is expelled, or dies and the business of the dissolved partnership is continued by one or more of the partners, either alone or with others, without liquidation of the partnership affairs, creditors of the first or dissolved partnership are also creditors of the person or partnership continuing the business.

(b) When all the partners or their representatives assign their rights in partnership property to one 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.

(c) The liability of a third person becoming a partner in the partnership continuing the business, under this Code section, to the creditors of the dissolved partnership shall be satisfied out of partnership property only.

(d) When the business of a partnership after dissolution is continued under any conditions set forth in this Code section the creditors of the dissolved partnership, as against the separate creditors of the withdrawing or deceased partner or the representative of the deceased partner, have a prior right to any claim of the withdrawn partner or the representative of the deceased partner against the person or partnership continuing the business, on account of the withdrawn or deceased partner's interest in the dissolved partnership or on account of any consideration promised for such interest or for his right in partnership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.

(e) Nothing in this Code section shall be held to modify any right of creditors to set aside any assignment on the ground of fraud.

(f) 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.