178.37 Rights of retiring or deceased partner. - Wisconsin Statutes

178.37

178.37 Rights of retiring or deceased partner. If any partner retires or dies, and the business is continued under any of the conditions set forth in s. 178.33 (2) (b) or 178.36 (1), (2), (3), (5) and (6), without any settlement of accounts as between the retired or deceased partner or the deceased partner's estate and the person or partnership continuing the business, unless otherwise agreed, the retired partner or the deceased partner's legal representative as against such persons or partnership may have the value of the retired or deceased partner's interest at the date of dissolution ascertained, and shall receive as an ordinary creditor an amount equal to the value of the retired or deceased partner's interest in the dissolved partnership with interest, or, at the option of the retired partner or the deceased partner's legal representative, in lieu of interest, the profits attributable to the use of the retired or deceased partner's right in the property of the dissolved partnership; provided that the creditors of the dissolved partnership as against the separate creditors, or the representative of the retired or deceased partner, shall have priority on any claim arising under this section, as provided by s. 178.36 (8).

178.37 - ANNOT.

History: 1993 a. 482.

178.37 - ANNOT.

A personal representative who is also a partner may not deprive a deceased partner's estate of its rights to interest or profits under this section. Hence, a personal representative possessed no authority to waive the estate's rights under the statute, and the personal representative must choose one of the options provided. McDonald v. McDonald, 68 Wis. 2d 292, 228 N.W.2d 727 (1975).

178.37 - ANNOT.

When a legal representative has failed or refused to act, an heir may maintain an action to recover assets for the benefit of an estate. Schaefer v. Schaefer, 89 Wis. 2d 323, 278 N.W.2d 332 (Ct. App. 1979).

178.37 - ANNOT.

A business run for 8 years by a surviving partner was winding up under s. 178.33 (1), not continuing under s. 178.37. Trust Estate of Schaefer, 91 Wis. 2d 360, 283 N.W.2d 410 (Ct. App. 1979).

178.37 - ANNOT.

A deceased or withdrawing partner has no claim to post-dissolution profits that are related to the skill and services of the remaining partners. Fees from work in progress at the time of dissolution constitute partnership assets allocated to each partner according to the partnership formula without any additional compensation to the partner who performs the work. Gull v. Van Epps, 185 Wis. 2d 609, 517 N.W.2d 531 (Ct. App. 1994).

178.37 - ANNOT.

The burden is on the retiring partner, not the continuing partner, to prove "profits attributable." Exiting partners are not entitled to a full predissolution profit share after dissolution because the predissolution profit-sharing ratio was predicated in part on that partner's contribution of services, which ended upon dissolution, while after dissolution, the exiting partner is compensated for the use of its investment in the partnership. Estate of Matteson v. Matteson, 2008 WI 48, 309 Wis. 2d 311, 749 N.W.2d 557, 05-2607.