Commerce and Trade
Other Laws Relating to Commerce and Trade
CHAPTER 15. DELAWARE REVISED UNIFORM PARTNERSHIP ACT
Subchapter V. Transferees and Creditors of Partner
§ 15-501 Partner not co-owner of partnership property.
Unless otherwise provided in a statement of partnership existence or a statement of qualification and in a partnership agreement, a partner is not a co-owner of partnership property and has no interest in specific partnership property.
72 Del. Laws, c. 151, § 1; 72 Del. Laws, c. 390, § 18; 77 Del. Laws, c. 59, § 9.;
§ 15-502 Partner's economic interest in partnership; personal property.
A partnership interest is personal property. Only a partner's economic interest may be transferred.
72 Del. Laws, c. 151, § 1.;
§ 15-503 Transfer of partner's economic interest.
(a) A transfer, in whole or in part, of a partner's economic interest in the partnership:
(1) Is permissible;
(2) Does not by itself cause the partner's dissociation or a dissolution and winding up of the partnership business or affairs; and
(3) Does not entitle the transferee to participate in the management or conduct of the partnership business or affairs, 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 economic interest in the partnership has a right:
(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 or affairs, in accordance with the transfer, the net amount otherwise distributable to the transferor; and
(3) To seek under § 15-801(6) of this title a judicial determination that it is equitable to wind up the partnership business or affairs.
(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 economic interest transferred.
(e) A partnership need not give effect to a transferee's rights under this section until it has notice of the transfer. Upon request of a partnership or a partner, a transferee must furnish reasonable proof of a transfer.
(f) A transfer of a partner's economic interest in the partnership in violation of a restriction on transfer contained in a partnership agreement is ineffective.
(g) Notwithstanding anything to the contrary under applicable law, a partnership agreement may provide that a partner's economic interest may not be transferred prior to the dissolution and winding up of the partnership.
(h) A partnership interest in a partnership may be evidenced by a certificate of partnership interest issued by the partnership. A partnership agreement may provide for the transfer of any partnership interest represented by such a certificate and make other provisions with respect to such certificates. A partnership shall not have the power to issue a certificate of partnership interest in bearer form.
(i) Except to the extent assumed by agreement, until a transferee of a partnership interest becomes a partner, the transferee shall have no liability as a partner solely as a result of the transfer.
(j) A partnership may acquire, by purchase, redemption or otherwise, any partnership interest or other interest of a partner in the partnership. Any such interest so acquired by the partnership shall be deemed canceled.
72 Del. Laws, c. 151, § 1; 73 Del. Laws, c. 85, § 12; 76 Del. Laws, c. 106, § 10.;
§ 15-504 Partner's economic interest subject to charging order.
(a) On application by a judgment creditor of a partner or of a partner's transferee, a court having jurisdiction may charge the economic interest of the judgment debtor to satisfy the judgment. To the extent so charged, the judgment creditor has only the right to receive any distribution or distributions to which the judgment debtor would otherwise have been entitled in respect of such economic interest.
(b) A charging order constitutes a lien on the judgment debtor's economic interest in the partnership.
(c) This chapter does not deprive a partner or a partner's transferee of a right under exemption laws with respect to the judgment debtor's economic interest in the partnership.
(d) The entry of a charging order is the exclusive remedy by which a judgment creditor of a partner or of a partner's transferee may satisfy a judgment out of the judgment debtor's economic interest in the partnership and attachment, garnishment, foreclosure or other legal or equitable remedies are not available to the judgment creditor.
(e) No creditor of a partner or of a partner's transferee shall have any right to obtain possession of, or otherwise exercise legal or equitable remedies with respect to, the property of the partnership.
(f) The Court of Chancery shall have jurisdiction to hear and determine any matter relating to any such charging order.
72 Del. Laws, c. 151, § 1; 72 Del. Laws, c. 390, § 19; 75 Del. Laws, c. 50, §§ 5-11; 79 Del. Laws, c. 75, § 1.;