42:2A-46 - Liability upon return of contribution - New Jersey Statutes

42:2A-46.    Liability upon return of contribution
     Liability upon return of contribution.  a.  If a limited partner has received the return of any part of his contribution without violation of the partnership agreement or this chapter, he is liable to the limited partnership for a period of one year thereafter for the amount of the returned contribution, but only to the extent necessary to discharge the limited partnership's liabilities to creditors who extended credit to the limited partnership during the period the contribution was held by the partnership.

    b.   If a limited partner has received the return of any part of his contribution in violation of the partnership agreement or this chapter, he is liable to the limited partnership for a period of six years thereafter for the amount of the contribution wrongfully returned.

    c.   If a general partner has received the return of any part of his contribution without violation of the partnership agreement or this chapter, he is liable, until the termination of the applicable statute of limitations, to the limited partnership for the amount of the returned contribution, but only to the extent necessary to discharge the limited partnership's liabilities to creditors who extended credit to the limited partnership during the period the contribution was held by the partnership.

    d.   If a general partner has received the return of any part of his contribution in violation of the partnership agreement or this chapter, he is liable, until the termination of the applicable statute of limitations, to the limited partnership for the amount of the contribution wrongfully returned.

    e.   A partner receives a return of his contribution to the extent that a distribution causes the partner's share of the fair value of the net assets of the partnership to be less than the value, determined at the time of, but without giving effect to the distribution, of the balance of the partner's aggregate contributions to the partnership which, as of that date, had not been returned to him, which determination shall be made on the basis of the partnership records required to be maintained pursuant to section 9 of P.L. 1983, c. 489 (C. 42:2A-9).

    L. 1983, c. 489, s. 45; amended 1988,c.130,s.23.