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S1041................................................by JUDICIARY AND RULES
UNIFORM LIMITED PARTNERSHIP ACT - Repeals and adds to existing law to
provide for the Uniform Limited Partnership Act; to define terms; to
provide for knowledge and notice; to set forth powers; to provide governing
law; to provide a rate of interest; to provide for names and reservation of
names; to set forth effect of partnership agreements; to set forth required
information; to provide for business transactions of partners with a
partnership; to provide for dual capacity; to provide for offices and
agents for service of process; to provide for service of process; to
provide for consent and proxies of partners; to provide for the formation
of limited partnerships; to provide for delivery and filing of records by
the Secretary of State; to provide for liability for false information in
filed records; to provide for annual reports; to limit the right or power
to bind limited partnerships; to limit liability; to provide for the right
to information; to set forth provisions applicable to becoming a general
partner; to provide for a general partner agent; to set forth general
standards of conduct; to provide for forms of contribution; to provide for
distributions; to provide for dissociation of persons as limited partners;
to provide for winding up of the partnership; to provide for the
disposition of assets; to set forth governing law for foreign limited
partnerships; to provide for conversions and mergers; to set forth
provisions applicable to the Electronic Signatures in Global and National
Commerce Act; and to provide for application to existing relationships.
01/20 Senate intro - 1st rdg - to printing
01/21 Rpt prt - to Jud
]]]] LEGISLATURE OF THE STATE OF IDAHO ]]]]
Fifty-eighth Legislature First Regular Session - 2005
IN THE SENATE
SENATE BILL NO. 1041
BY JUDICIARY AND RULES COMMITTEE
1 AN ACT
2 RELATING TO THE UNIFORM LIMITED PARTNERSHIP ACT; REPEALING CHAPTER 2, TITLE
3 53, IDAHO CODE; AMENDING TITLE 53, IDAHO CODE, BY THE ADDITION OF A NEW
4 CHAPTER 2, TITLE 53, IDAHO CODE, TO PROVIDE FOR THE UNIFORM LIMITED PART-
5 NERSHIP ACT, TO PROVIDE A SHORT TITLE, TO DEFINE TERMS, TO PROVIDE FOR
6 KNOWLEDGE AND NOTICE, TO PROVIDE FOR NATURE, PURPOSE AND DURATION OF ENTI-
7 TIES, TO SET FORTH POWERS, TO PROVIDE GOVERNING LAW, TO PROVIDE SUPPLEMEN-
8 TAL PRINCIPLES OF LAW, TO PROVIDE A RATE OF INTEREST, TO PROVIDE FOR NAMES
9 AND RESERVATION OF NAMES, TO SET FORTH EFFECT OF PARTNERSHIP AGREEMENTS,
10 TO PROVIDE NONWAIVABLE PROVISIONS, TO SET FORTH REQUIRED INFORMATION, TO
11 PROVIDE FOR BUSINESS TRANSACTIONS OF PARTNERS WITH A PARTNERSHIP, TO PRO-
12 VIDE FOR DUAL CAPACITY, TO PROVIDE FOR OFFICES AND AGENTS FOR SERVICE OF
13 PROCESS, TO PROVIDE FOR CHANGES OF DESIGNATED OFFICES OR AGENTS FOR SER-
14 VICE OF PROCESS, TO PROVIDE FOR THE RESIGNATION OF AGENTS FOR SERVICE OF
15 PROCESS, TO PROVIDE FOR SERVICE OF PROCESS, TO PROVIDE FOR CONSENT AND
16 PROXIES OF PARTNERS, TO PROVIDE FOR THE FORMATION OF LIMITED PARTNERSHIPS
17 AND CERTIFICATES OF LIMITED PARTNERSHIPS, TO PROVIDE FOR AMENDMENT OR
18 RESTATEMENT OF CERTIFICATES, TO PROVIDE FOR STATEMENTS OF TERMINATION, TO
19 PROVIDE FOR THE SIGNING OF RECORDS, TO PROVIDE FOR SIGNING AND FILING PUR-
20 SUANT TO A JUDICIAL ORDER, TO PROVIDE FOR DELIVERY TO AND FILING OF
21 RECORDS BY THE SECRETARY OF STATE, TO SET FORTH EFFECTIVE TIMES AND DATES,
22 TO PROVIDE FOR CORRECTING FILED RECORDS, TO PROVIDE FOR LIABILITY FOR
23 FALSE INFORMATION IN FILED RECORDS, TO PROVIDE FOR CERTIFICATES OF EXIS-
24 TENCE OR AUTHORIZATION, TO PROVIDE FOR ANNUAL REPORTS FOR THE SECRETARY OF
25 STATE, TO SET FORTH PROVISIONS APPLICABLE TO BECOMING A LIMITED PARTNER,
26 TO LIMIT THE RIGHT OR POWER TO BIND LIMITED PARTNERSHIP, TO LIMIT LIABIL-
27 ITY, TO PROVIDE FOR THE RIGHT TO INFORMATION, TO SET FORTH LIMITED DUTIES
28 OF LIMITED PARTNERS, TO SET FORTH PROVISIONS APPLICABLE TO PERSONS WHO
29 ERRONEOUSLY BELIEVE THEMSELVES TO BE A LIMITED PARTNER, TO SET FORTH PRO-
30 VISIONS APPLICABLE TO BECOMING A GENERAL PARTNER, TO PROVIDE FOR A GENERAL
31 PARTNER AGENT, TO PROVIDE FOR LIABILITY, TO PROVIDE FOR ACTIONS BY AND
32 AGAINST PARTNERSHIPS AND PARTNERS, TO PROVIDE FOR MANAGEMENT RIGHTS, TO
33 PROVIDE FOR THE RIGHT TO INFORMATION, TO SET FORTH GENERAL STANDARDS OF
34 CONDUCT, TO PROVIDE FOR FORMS OF CONTRIBUTION, TO PROVIDE FOR LIABILITY
35 FOR CONTRIBUTION, TO PROVIDE FOR THE SHARING OF DISTRIBUTIONS, TO PROVIDE
36 FOR INTERIM DISTRIBUTIONS, TO LIMIT THE RIGHT TO RECEIVE DISTRIBUTIONS, TO
37 PROVIDE FOR DISTRIBUTIONS IN KIND, TO PROVIDE FOR THE RIGHT TO DISTRIBU-
38 TION, TO SET FORTH LIMITATIONS ON DISTRIBUTIONS, TO PROVIDE FOR LIABILITY
39 FOR IMPROPER DISTRIBUTIONS, TO PROVIDE FOR DISSOCIATION OF PERSONS AS LIM-
40 ITED PARTNERS, TO SET FORTH THE EFFECT OF DISSOCIATION, TO PROVIDE FOR
41 DISSOCIATION OF PERSONS AS GENERAL PARTNERS, TO PROVIDE FOR A PERSON'S
42 POWER TO DISSOCIATE AS GENERAL PARTNER, TO PROVIDE FOR WRONGFUL DISSOCIA-
43 TION, TO SET FORTH THE EFFECT OF DISSOCIATION, TO PROVIDE FOR THE POWER TO
44 BIND AND LIABILITY TO LIMITED PARTNERSHIPS BEFORE DISSOLUTION OR DISSOCIA-
45 TION, TO PROVIDE FOR A PARTNER'S TRANSFERABLE INTEREST, TO PROVIDE FOR
46 TRANSFER OF A PARTNER'S TRANSFERABLE INTEREST, TO PROVIDE RIGHTS OF CREDI-
2
1 TORS, TO PROVIDE POWER OF ESTATE OF DECEASED PARTNER, TO PROVIDE FOR NON-
2 JUDICIAL DISSOLUTION, TO PROVIDE FOR JUDICIAL DISSOLUTION, TO PROVIDE FOR
3 WINDING UP OF THE PARTNERSHIP, TO PROVIDE FOR THE POWER OF CERTAIN PERSONS
4 TO BIND PARTNERSHIP AFTER DISSOLUTION, TO PROVIDE FOR LIABILITY, TO PRO-
5 VIDE FOR KNOWN AND OTHER CLAIMS AGAINST A DISSOLVED LIMITED PARTNERSHIP,
6 TO PROVIDE FOR LIABILITY OF CERTAIN PERSONS WHEN CLAIMS AGAINST A LIMITED
7 PARTNERSHIP ARE BARRED, TO PROVIDE FOR ADMINISTRATIVE DISSOLUTION, TO PRO-
8 VIDE FOR REINSTATEMENT, TO PROVIDE FOR APPEALS FROM A DENIAL OF REINSTATE-
9 MENT, TO PROVIDE FOR THE DISPOSITION OF ASSETS, TO SET FORTH WHEN CONTRI-
10 BUTIONS ARE REQUIRED, TO SET FORTH GOVERNING LAW FOR FOREIGN LIMITED PART-
11 NERSHIPS, TO PROVIDE FOR APPLICATION FOR CERTIFICATES OF AUTHORITY, TO SET
12 FORTH ACTIVITIES NOT CONSTITUTING TRANSACTING BUSINESS, TO PROVIDE FOR THE
13 FILING OF CERTIFICATES OF AUTHORITY, TO PROVIDE FOR NONCOMPLYING NAMES OF
14 FOREIGN LIMITED PARTNERSHIPS, TO PROVIDE FOR REVOCATION OF CERTIFICATES OF
15 AUTHORITY, TO PROVIDE FOR CANCELLATION OF CERTIFICATES OF AUTHORITY, TO
16 SET FORTH THE EFFECT OF A FAILURE TO HAVE A CERTIFICATE, TO PROVIDE FOR
17 ACTION BY THE ATTORNEY GENERAL, TO PROVIDE FOR DIRECT ACTION BY A PARTNER,
18 TO PROVIDE FOR DERIVATIVE ACTIONS, TO IDENTIFY PROPER PLAINTIFFS, TO PRO-
19 VIDE FOR PLEADINGS, TO PROVIDE FOR PROCEEDS AND EXPENSES, TO DEFINE TERMS
20 RELATING TO CONVERSIONS AND MERGERS, TO PROVIDE FOR CONVERSION, TO PROVIDE
21 FOR ACTION ON PLANS OF CONVERSION, TO SET FORTH FILINGS REQUIRED FOR CON-
22 VERSION, TO PROVIDE EFFECTIVE DATE OF PLANS, TO SET FORTH THE EFFECT OF
23 CONVERSION, TO PROVIDE FOR MERGERS, TO PROVIDE FOR ACTION ON PLANS OF
24 MERGER, TO SET FORTH FILINGS REQUIRED FOR MERGERS, TO PROVIDE EFFECTIVE
25 DATE OF PLANS, TO SET FORTH THE EFFECT OF MERGER, TO SET FORTH RESTRIC-
26 TIONS ON APPROVAL OF CONVERSIONS, MERGERS AND ON RELINQUISHING CERTAIN
27 STATUS, TO PROVIDE FOR LIABILITY AFTER CONVERSION OR MERGER, TO PROVIDE
28 FOR THE POWER OF CERTAIN PERSONS TO BIND AN ORGANIZATION AFTER CONVERSION
29 OR MERGER, TO PROVIDE FOR NONEXCLUSIVITY, TO PROVIDE FOR UNIFORMITY OF
30 APPLICATION AND CONSTRUCTION, TO PROVIDE FOR SEVERABILITY, TO SET FORTH
31 PROVISIONS APPLICABLE TO RELATION TO THE ELECTRONIC SIGNATURES IN GLOBAL
32 AND NATIONAL COMMERCE ACT, TO PROVIDE FOR APPLICATION TO EXISTING RELA-
33 TIONSHIPS AND TO PROVIDE A SAVINGS CLAUSE; AND PROVIDING AN EFFECTIVE
34 DATE.
35 Be It Enacted by the Legislature of the State of Idaho:
36 SECTION 1. That Chapter 2, Title 53, Idaho Code, be, and the same is
37 hereby repealed.
38 SECTION 2. That Title 53, Idaho Code, be, and the same is hereby amended
39 by the addition thereto of a NEW CHAPTER, to be known and designated as Chap-
40 ter 2, Title 53, Idaho Code, and to read as follows:
41 CHAPTER 2
42 UNIFORM LIMITED PARTNERSHIP ACT
43 PART 1
44 GENERAL PROVISIONS
45 53-2-101. SHORT TITLE. This chapter may be cited as the "Uniform Limited
46 Partnership Act."
47 53-2-102. DEFINITIONS. In this chapter:
48 (1) "Certificate of limited partnership" means the certificate required
3
1 by section 53-2-201, Idaho Code. The term includes the certificate as amended
2 or restated.
3 (2) "Contribution," except in the phrase "right of contribution," means
4 any benefit provided by a person to a limited partnership in order to become a
5 partner or in the person's capacity as a partner.
6 (3) "Debtor in bankruptcy" means a person that is the subject of:
7 (a) An order for relief under title 11 of the United States Code or a
8 comparable order under a successor statute of general application; or
9 (b) A comparable order under federal, state, or foreign law governing
10 insolvency.
11 (4) "Designated office" means:
12 (a) With respect to a limited partnership, the office that the limited
13 partnership is required to designate and maintain under section 53-2-114,
14 Idaho Code; and
15 (b) With respect to a foreign limited partnership, its principal office.
16 (5) "Distribution" means a transfer of money or other property from a
17 limited partnership to a partner in the partner's capacity as a partner or to
18 a transferee on account of a transferable interest owned by the transferee.
19 (6) "Foreign limited liability limited partnership" means a foreign lim-
20 ited partnership whose general partners have limited liability for the obliga-
21 tions of the foreign limited partnership under a provision similar to section
22 53-2-404(3), Idaho Code.
23 (7) "Foreign limited partnership" means a partnership formed under the
24 laws of a jurisdiction other than this state and required by those laws to
25 have one (1) or more general partners and one (1) or more limited partners.
26 The term includes a foreign limited liability limited partnership.
27 (8) "General partner" means:
28 (a) With respect to a limited partnership, a person that:
29 (i) Becomes a general partner under section 53-2-401, Idaho Code;
30 or
31 (ii) Was a general partner in a limited partnership when the limited
32 partnership became subject to this chapter under section 53-2-1204(1)
33 or (2), Idaho Code; and
34 (b) With respect to a foreign limited partnership, a person that has
35 rights, powers, and obligations similar to those of a general partner in a
36 limited partnership.
37 (9) "Limited liability limited partnership," except in the phrase
38 "foreign limited liability limited partnership," means a limited partnership
39 whose certificate of limited partnership states that the limited partnership
40 is a limited liability limited partnership.
41 (10) "Limited partner" means:
42 (a) With respect to a limited partnership, a person that:
43 (i) Becomes a limited partner under section 53-2-301, Idaho Code;
44 or
45 (ii) Was a limited partner in a limited partnership when the limited
46 partnership became subject to this chapter under section 53-2-1204(1)
47 or (2), Idaho Code; and
48 (b) With respect to a foreign limited partnership, a person that has
49 rights, powers, and obligations similar to those of a limited partner in a
50 limited partnership.
51 (11) "Limited partnership," except in the phrases "foreign limited part-
52 nership" and "foreign limited liability limited partnership," means an entity,
53 having one (1) or more general partners and one (1) or more limited partners,
54 which is formed under this chapter by two (2) or more persons or becomes sub-
55 ject to this chapter under part 11 or section 53-2-1204(1) or (2), Idaho Code.
4
1 The term includes a limited liability limited partnership.
2 (12) "Partner" means a limited partner or general partner.
3 (13) "Partnership agreement" means the partners' agreement, whether oral,
4 implied, in a record, or in any combination, concerning the limited partner-
5 ship. The term includes the agreement as amended.
6 (14) "Person" means an individual, corporation, business trust, estate,
7 trust, partnership, limited liability company, association, joint venture,
8 government; governmental subdivision, agency, or instrumentality; public cor-
9 poration, or any other legal or commercial entity.
10 (15) "Person dissociated as a general partner" means a person dissociated
11 as a general partner of a limited partnership.
12 (16) "Principal office" means the office where the principal executive
13 office of a limited partnership or foreign limited partnership is located,
14 whether or not the office is located in this state.
15 (17) "Record" means information that is inscribed on a tangible medium or
16 that is stored in an electronic or other medium and is retrievable in
17 perceivable form.
18 (18) "Required information" means the information that a limited partner-
19 ship is required to maintain under section 53-2-111, Idaho Code.
20 (19) "Sign" means:
21 (a) To execute or adopt a tangible symbol with the present intent to
22 authenticate a record; or
23 (b) To attach or logically associate an electronic symbol, sound, or
24 process to or with a record with the present intent to authenticate the
25 record.
26 (20) "State" means a state of the United States, the District of Columbia,
27 Puerto Rico, the United States Virgin Islands, or any territory or insular
28 possession subject to the jurisdiction of the United States.
29 (21) "Transfer" includes an assignment, conveyance, deed, bill of sale,
30 lease, mortgage, security interest, encumbrance, gift, and transfer by opera-
31 tion of law.
32 (22) "Transferable interest" means a partner's right to receive distribu-
33 tions.
34 (23) "Transferee" means a person to which all or part of a transferable
35 interest has been transferred, whether or not the transferor is a partner.
36 53-2-103. KNOWLEDGE AND NOTICE. (1) A person knows a fact if the person
37 has actual knowledge of it.
38 (2) A person has notice of a fact if the person:
39 (a) Knows of it;
40 (b) Has received a notification of it;
41 (c) Has reason to know it exists from all of the facts known to the per-
42 son at the time in question; or
43 (d) Has notice of it under subsection (3) or (4) of this section.
44 (3) A certificate of limited partnership on file in the office of the
45 secretary of state is notice that the partnership is a limited partnership and
46 the persons designated in the certificate as general partners are general
47 partners. Except as otherwise provided in subsection (4) of this section, the
48 certificate is not notice of any other fact.
49 (4) A person has notice of:
50 (a) Another person's dissociation as a general partner, ninety (90) days
51 after the effective date of an amendment to the certificate of limited
52 partnership which states that the other person has dissociated or ninety
53 (90) days after the effective date of a statement of dissociation pertain-
54 ing to the other person, whichever occurs first;
5
1 (b) A limited partnership's dissolution, ninety (90) days after the
2 effective date of an amendment to the certificate of limited partnership
3 stating that the limited partnership is dissolved;
4 (c) A limited partnership's termination, ninety (90) days after the
5 effective date of a statement of termination;
6 (d) A limited partnership's conversion under part 11 of this chapter,
7 ninety (90) days after the effective date of the articles of conversion;
8 or
9 (e) A merger under part 11 of this chapter, ninety (90) days after the
10 effective date of the articles of merger.
11 (5) A person notifies or gives a notification to another person by taking
12 steps reasonably required to inform the other person in ordinary course,
13 whether or not the other person learns of it.
14 (6) A person receives a notification when the notification:
15 (a) Comes to the person's attention; or
16 (b) Is delivered at the person's place of business or at any other place
17 held out by the person as a place for receiving communications.
18 (7) Except as otherwise provided in subsection (8) of this section, a
19 person other than an individual knows, has notice, or receives a notification
20 of a fact for purposes of a particular transaction when the individual con-
21 ducting the transaction for the person knows, has notice, or receives a noti-
22 fication of the fact, or in any event when the fact would have been brought to
23 the individual's attention if the person had exercised reasonable diligence.
24 A person other than an individual exercises reasonable diligence if it main-
25 tains reasonable routines for communicating significant information to the
26 individual conducting the transaction for the person and there is reasonable
27 compliance with the routines. Reasonable diligence does not require an indi-
28 vidual acting for the person to communicate information unless the communica-
29 tion is part of the individual's regular duties or the individual has reason
30 to know of the transaction and that the transaction would be materially
31 affected by the information.
32 (8) A general partner's knowledge, notice, or receipt of a notification
33 of a fact relating to the limited partnership is effective immediately as
34 knowledge of, notice to, or receipt of a notification by the limited partner-
35 ship, except in the case of a fraud on the limited partnership committed by or
36 with the consent of the general partner. A limited partner's knowledge,
37 notice, or receipt of a notification of a fact relating to the limited part-
38 nership is not effective as knowledge of, notice to, or receipt of a notifica-
39 tion by the limited partnership.
40 53-2-104. NATURE, PURPOSE AND DURATION OF ENTITY. (1) A limited partner-
41 ship is an entity distinct from its partners. A limited partnership is the
42 same entity regardless of whether its certificate states that the limited
43 partnership is a limited liability limited partnership.
44 (2) A limited partnership may be organized under this chapter for any
45 lawful purpose.
46 (3) A limited partnership has a perpetual duration.
47 53-2-105. POWERS. A limited partnership has the powers to do all things
48 necessary or convenient to carry on its activities, including the power to
49 sue, be sued, and defend in its own name and to maintain an action against a
50 partner for harm caused to the limited partnership by a breach of the partner-
51 ship agreement or violation of a duty to the partnership.
52 53-2-106. GOVERNING LAW. The law of this state governs relations among
6
1 the partners of a limited partnership and between the partners and the limited
2 partnership and the liability of partners as partners for an obligation of the
3 limited partnership.
4 53-2-107. SUPPLEMENTAL PRINCIPLES OF LAW -- RATE OF INTEREST. (1) Unless
5 displaced by particular provisions of this chapter, the principles of law and
6 equity supplement this chapter.
7 (2) If an obligation to pay interest arises under this chapter and the
8 rate is not specified, the rate is that specified in section 28-22-104(1),
9 Idaho Code.
10 53-2-108. NAME. (1) The name of a limited partnership may contain the
11 name of any partner.
12 (2) The name of a limited partnership that is not a limited liability
13 limited partnership must contain the phrase "limited partnership" or the
14 abbreviation "L.P." or "LP" and may not contain the phrase "limited liability
15 limited partnership" or the abbreviation "LLLP" or "L.L.L.P."
16 (3) The name of a limited liability limited partnership must contain the
17 phrase "limited liability limited partnership" or the abbreviation "LLLP" or
18 "L.L.L.P." and must not contain the abbreviation "L.P." or "LP."
19 (4) Unless authorized by subsection (5) of this section, the name of a
20 limited partnership must be distinguishable in the records of the secretary of
21 state from:
22 (a) The name of each person other than an individual incorporated, orga-
23 nized, or authorized to transact business in this state; and
24 (b) Each name reserved under section 53-2-109, Idaho Code, or other state
25 law allowing the reservation or registration of business names.
26 (5) A limited partnership may apply to the secretary of state for autho-
27 rization to use a name that does not comply with subsection (4) of this sec-
28 tion. The secretary of state shall authorize use of the name applied for if,
29 as to each conflicting name:
30 (a) The present user, registrant, or owner of the conflicting name con-
31 sents in a signed record to the use and submits an undertaking in a form
32 satisfactory to the secretary of state to change the conflicting name to a
33 name that complies with subsection (4) of this section and is distinguish-
34 able in the records of the secretary of state from the name applied for;
35 (b) The applicant delivers to the secretary of state a certified copy of
36 the final judgment of a court of competent jurisdiction establishing the
37 applicant's right to use in this state the name applied for; or
38 (c) The applicant delivers to the secretary of state proof satisfactory
39 to the secretary of state that the present user, registrant, or owner of
40 the conflicting name:
41 (i) Has merged into the applicant;
42 (ii) Has been converted into the applicant; or
43 (iii) Has transferred substantially all of its assets, including the
44 conflicting name, to the applicant.
45 (6) Subject to section 53-2-905, Idaho Code, this section applies to any
46 foreign limited partnership transacting business in this state, having a cer-
47 tificate of authority to transact business in this state, or applying for a
48 certificate of authority.
49 53-2-109. RESERVATION OF NAME. (1) The exclusive right to the use of a
50 name that complies with section 53-2-108, Idaho Code, may be reserved by:
51 (a) A person intending to organize a limited partnership under this chap-
52 ter and to adopt the name;
7
1 (b) A limited partnership or a foreign limited partnership authorized to
2 transact business in this state intending to adopt the name;
3 (c) A foreign limited partnership intending to obtain a certificate of
4 authority to transact business in this state and adopt the name;
5 (d) A person intending to organize a foreign limited partnership and
6 intending to have it obtain a certificate of authority to transact busi-
7 ness in this state and adopt the name;
8 (e) A foreign limited partnership formed under the name; or
9 (f) A foreign limited partnership formed under a name that does not com-
10 ply with section 53-2-108(2) or (3), Idaho Code, but the name reserved
11 under this paragraph (f) may differ from the foreign limited partnership's
12 name only to the extent necessary to comply with section 53-2-108(2) and
13 (3), Idaho Code.
14 (2) A person may apply to reserve a name under subsection (1) of this
15 section by delivering to the secretary of state for filing an application that
16 states the name to be reserved and the paragraph of subsection (1) of this
17 section which applies. If the secretary of state finds that the name is avail-
18 able for use by the applicant, the secretary of state shall file a statement
19 of name reservation and thereby reserve the name for the exclusive use of the
20 applicant for one hundred twenty (120) days.
21 (3) An applicant that has reserved a name pursuant to subsection (2) of
22 this section may reserve the same name for additional one hundred twenty (120)
23 day periods. A person having a current reservation for a name may not apply
24 for another one hundred twenty (120) day period for the same name until ninety
25 (90) days have elapsed in the current reservation.
26 (4) A person that has reserved a name under this section may deliver to
27 the secretary of state for filing a notice of transfer that states the
28 reserved name, the name and street and mailing address of some other person to
29 which the reservation is to be transferred, and the paragraph of subsection
30 (1) of this section which applies to the other person. Subject to section
31 53-2-206(3), Idaho Code, the transfer is effective when the secretary of state
32 files the notice of transfer.
33 53-2-110. EFFECT OF PARTNERSHIP AGREEMENT -- NONWAIVABLE PROVISIONS. (1)
34 Except as otherwise provided in subsection (2) of this section, the partner-
35 ship agreement governs relations among the partners and between the partners
36 and the partnership. To the extent the partnership agreement does not other-
37 wise provide, this chapter governs relations among the partners and between
38 the partners and the partnership.
39 (2) A partnership agreement may not:
40 (a) Vary a limited partnership's power under section 53-2-105, Idaho
41 Code, to sue, be sued, and defend in its own name;
42 (b) Vary the law applicable to a limited partnership under section
43 53-2-106, Idaho Code;
44 (c) Vary the requirements of section 53-2-204, Idaho Code;
45 (d) Vary the information required under section 53-2-111, Idaho Code, or
46 unreasonably restrict the right to information under section 53-2-304 or
47 53-2-407, Idaho Code, but the partnership agreement may impose reasonable
48 restrictions on the availability and use of information obtained under
49 those sections and may define appropriate remedies, including liquidated
50 damages, for a breach of any reasonable restriction on use;
51 (e) Eliminate the duty of loyalty under section 53-2-408, Idaho Code, but
52 the partnership agreement may:
53 (i) Identify specific types or categories of activities that do not
54 violate the duty of loyalty, if not manifestly unreasonable; and
8
1 (ii) Specify the number or percentage of partners which may author-
2 ize or ratify, after full disclosure to all partners of all material
3 facts, a specific act or transaction that otherwise would violate the
4 duty of loyalty;
5 (f) Unreasonably reduce the duty of care under section 53-2-408(3), Idaho
6 Code;
7 (g) Eliminate the obligation of good faith and fair dealing under sec-
8 tions 53-2-305(2) and 53-2-408(4), Idaho Code, but the partnership agree-
9 ment may prescribe the standards by which the performance of the obliga-
10 tion is to be measured, if the standards are not manifestly unreasonable;
11 (h) Vary the power of a person to dissociate as a general partner under
12 section 53-2-604(1), Idaho Code, except to require that the notice under
13 section 53-2-603(1), Idaho Code, be in a record;
14 (i) Vary the power of a court to decree dissolution in the circumstances
15 specified in section 53-2-802, Idaho Code;
16 (j) Vary the requirement to wind up the partnership's business as speci-
17 fied in section 53-2-803, Idaho Code;
18 (k) Unreasonably restrict the right to maintain an action under part 10
19 of this chapter;
20 (l) Restrict the right of a partner under section 53-2-1110(1), Idaho
21 Code, to approve a conversion or merger or the right of a general partner
22 under section 53-2-1110(2), Idaho Code, to consent to an amendment to the
23 certificate of limited partnership which deletes a statement that the lim-
24 ited partnership is a limited liability limited partnership; or
25 (m) Restrict rights under this chapter of a person other than a partner
26 or a transferee.
27 53-2-111. REQUIRED INFORMATION. A limited partnership shall maintain at
28 its designated office the following information:
29 (1) A current list showing the full name and last known street and mail-
30 ing address of each partner, separately identifying the general partners, in
31 alphabetical order, and the limited partners, in alphabetical order;
32 (2) A copy of the initial certificate of limited partnership and all
33 amendments to and restatements of the certificate, together with signed copies
34 of any powers of attorney under which any certificate, amendment, or restate-
35 ment has been signed;
36 (3) A copy of any filed articles of conversion or merger;
37 (4) A copy of the limited partnership's federal, state, and local income
38 tax returns and reports, if any, for the three (3) most recent years;
39 (5) A copy of any partnership agreement made in a record and any amend-
40 ment made in a record to any partnership agreement;
41 (6) A copy of any financial statement of the limited partnership for the
42 three (3) most recent years;
43 (7) A copy of the three (3) most recent annual reports delivered by the
44 limited partnership to the secretary of state pursuant to section 53-2-210,
45 Idaho Code;
46 (8) A copy of any record made by the limited partnership during the past
47 three (3) years of any consent given by or vote taken of any partner pursuant
48 to this chapter or the partnership agreement; and
49 (9) Unless contained in a partnership agreement made in a record, a
50 record stating:
51 (a) The amount of cash, and a description and statement of the agreed
52 value of the other benefits, contributed and agreed to be contributed by
53 each partner;
54 (b) The times at which, or events on the happening of which, any addi-
9
1 tional contributions agreed to be made by each partner are to be made;
2 (c) For any person that is both a general partner and a limited partner,
3 a specification of what transferable interest the person owns in each
4 capacity; and
5 (d) Any events upon the happening of which the limited partnership is to
6 be dissolved and its activities wound up.
7 53-2-112. BUSINESS TRANSACTIONS OF PARTNER WITH PARTNERSHIP. A partner
8 may lend money to and transact other business with the limited partnership and
9 has the same rights and obligations with respect to the loan or other transac-
10 tion as a person that is not a partner.
11 53-2-113. DUAL CAPACITY. A person may be both a general partner and a
12 limited partner. A person that is both a general and limited partner has the
13 rights, powers, duties, and obligations provided by this chapter and the part-
14 nership agreement in each of those capacities. When the person acts as a gen-
15 eral partner, the person is subject to the obligations, duties and restric-
16 tions under this chapter and the partnership agreement for general partners.
17 When the person acts as a limited partner, the person is subject to the obli-
18 gations, duties and restrictions under this chapter and the partnership agree-
19 ment for limited partners.
20 53-2-114. OFFICE AND AGENT FOR SERVICE OF PROCESS. (1) A limited partner-
21 ship shall designate and continuously maintain in this state:
22 (a) An office, which need not be a place of its activity in this state;
23 and
24 (b) An agent for service of process.
25 (2) A foreign limited partnership shall designate and continuously main-
26 tain in this state an agent for service of process.
27 (3) An agent for service of process of a limited partnership or foreign
28 limited partnership must be an individual who is a resident of this state or
29 other person authorized to do business in this state.
30 53-2-115. CHANGE OF DESIGNATED OFFICE OR AGENT FOR SERVICE OF PROCESS.
31 (1) In order to change its designated office, agent for service of process, or
32 the address of its agent for service of process, a limited partnership or a
33 foreign limited partnership may deliver to the secretary of state for filing a
34 statement of change containing:
35 (a) The name of the limited partnership or foreign limited partnership;
36 (b) The street and mailing address of its current designated office;
37 (c) If the current designated office is to be changed, the street and
38 mailing address of the new designated office;
39 (d) The name and street and mailing address of its current agent for ser-
40 vice of process; and
41 (e) If the current agent for service of process or an address of the
42 agent is to be changed, the new information.
43 (2) Subject to section 53-2-206(3), Idaho Code, a statement of change is
44 effective when filed by the secretary of state.
45 53-2-116. RESIGNATION OF AGENT FOR SERVICE OF PROCESS. (1) In order to
46 resign as an agent for service of process of a limited partnership or foreign
47 limited partnership, the agent must deliver to the secretary of state for fil-
48 ing a statement of resignation containing the name of the limited partnership
49 or foreign limited partnership.
50 (2) After receiving a statement of resignation, the secretary of state
10
1 shall file it and mail a copy to the designated office of the limited partner-
2 ship or foreign limited partnership and another copy to the principal office
3 if the address of the office appears in the records of the secretary of state
4 and is different from the address of the designated office.
5 (3) An agency for service of process is terminated on the thirty-first
6 day after the secretary of state files the statement of resignation.
7 53-2-117. SERVICE OF PROCESS. (1) An agent for service of process
8 appointed by a limited partnership or foreign limited partnership is an agent
9 of the limited partnership or foreign limited partnership for service of any
10 process, notice, or demand required or permitted by law to be served upon the
11 limited partnership or foreign limited partnership.
12 (2) If a limited partnership or foreign limited partnership does not
13 appoint or maintain an agent for service of process in this state or the agent
14 for service of process cannot with reasonable diligence be found at the
15 agent's address, the secretary of state is an agent of the limited partnership
16 or foreign limited partnership upon whom process, notice, or demand may be
17 served.
18 (3) Service of any process, notice, or demand on the secretary of state
19 may be made by delivering to and leaving with the secretary of state duplicate
20 copies of the process, notice, or demand. If a process, notice, or demand is
21 served on the secretary of state, the secretary of state shall forward one (1)
22 of the copies by registered or certified mail, return receipt requested, to
23 the limited partnership or foreign limited partnership at its designated
24 office.
25 (4) Service is effected under subsection (3) of this section at the ear-
26 liest of:
27 (a) The date the limited partnership or foreign limited partnership
28 receives the process, notice, or demand;
29 (b) The date shown on the return receipt, if signed on behalf of the lim-
30 ited partnership or foreign limited partnership; or
31 (c) Five (5) days after the process, notice, or demand is deposited in
32 the mail, if mailed postpaid and correctly addressed.
33 (5) The secretary of state shall keep a record of each process, notice,
34 and demand served pursuant to this section and record the time of, and the
35 action taken regarding, the service.
36 (6) This section does not affect the right to serve process, notice, or
37 demand in any other manner provided by law.
38 53-2-118. CONSENT AND PROXIES OF PARTNERS. Action requiring the consent
39 of partners under this chapter may be taken without a meeting, and a partner
40 may appoint a proxy to consent or otherwise act for the partner by signing an
41 appointment record, either personally or by the partner's attorney in fact.
42 PART 2
43 FORMATION -- CERTIFICATE OF
44 LIMITED PARTNERSHIP AND OTHER FILINGS
45 53-2-201. FORMATION OF LIMITED PARTNERSHIP -- CERTIFICATE OF LIMITED
46 PARTNERSHIP. (1) In order for a limited partnership to be formed, a certifi-
47 cate of limited partnership must be delivered to the secretary of state for
48 filing. The certificate must state:
49 (a) The name of the limited partnership, which must comply with section
50 53-2-108, Idaho Code;
51 (b) The street and mailing address of the initial designated office and
11
1 the name and street and mailing address of the initial agent for service
2 of process;
3 (c) The name and the street and mailing address of each general partner;
4 (d) Whether the limited partnership is a limited liability limited part-
5 nership; and
6 (e) Any additional information required by part 11 of this chapter.
7 (2) A certificate of limited partnership may also contain any other mat-
8 ters but may not vary or otherwise affect the provisions specified in section
9 53-2-110(2), Idaho Code, in a manner inconsistent with that section.
10 (3) If there has been substantial compliance with subsection (1) of this
11 section, subject to section 53-2-206(3), Idaho Code, a limited partnership is
12 formed when the secretary of state files the certificate of limited partner-
13 ship.
14 (4) Subject to subsection (2) of this section, if any provision of a
15 partnership agreement is inconsistent with the filed certificate of limited
16 partnership or with a filed statement of dissociation, termination, or change
17 or filed articles of conversion or merger:
18 (a) The partnership agreement prevails as to partners and transferees;
19 and
20 (b) The filed certificate of limited partnership, statement of dissocia-
21 tion, termination, or change or articles of conversion or merger prevail
22 as to persons, other than partners and transferees, that reasonably rely
23 on the filed record to their detriment.
24 53-2-202. AMENDMENT OR RESTATEMENT OF CERTIFICATE. (1) In order to amend
25 its certificate of limited partnership, a limited partnership must deliver to
26 the secretary of state for filing an amendment or, pursuant to part 11 of this
27 chapter, articles of merger stating:
28 (a) The name of the limited partnership;
29 (b) The date of filing of its initial certificate; and
30 (c) The changes the amendment makes to the certificate as most recently
31 amended or restated.
32 (2) A limited partnership shall promptly deliver to the secretary of
33 state for filing an amendment to a certificate of limited partnership to
34 reflect:
35 (a) The admission of a new general partner;
36 (b) The dissociation of a person as a general partner; or
37 (c) The appointment of a person to wind up the limited partnership's
38 activities under section 53-2-803(3) or (4), Idaho Code.
39 (3) A general partner that knows that any information in a filed certifi-
40 cate of limited partnership was false when the certificate was filed or has
41 become false due to changed circumstances shall promptly:
42 (a) Cause the certificate to be amended; or
43 (b) If appropriate, deliver to the secretary of state for filing a state-
44 ment of change pursuant to section 53-2-115, Idaho Code, or a statement of
45 correction pursuant to section 53-2-207, Idaho Code.
46 (4) A certificate of limited partnership may be amended at any time for
47 any other proper purpose as determined by the limited partnership.
48 (5) A restated certificate of limited partnership may be delivered to the
49 secretary of state for filing in the same manner as an amendment.
50 (6) Subject to section 53-2-206(3), Idaho Code, an amendment or restated
51 certificate is effective when filed by the secretary of state.
52 53-2-203. STATEMENT OF TERMINATION. A dissolved limited partnership that
53 has completed winding up may deliver to the secretary of state for filing a
12
1 statement of termination that states:
2 (1) The name of the limited partnership;
3 (2) The date of filing of its initial certificate of limited partnership;
4 and
5 (3) Any other information as determined by the general partners filing
6 the statement or by a person appointed pursuant to section 53-2-803(3) or (4),
7 Idaho Code.
8 53-2-204. SIGNING OF RECORDS. (1) Each record delivered to the secretary
9 of state for filing pursuant to this chapter must be signed in the following
10 manner:
11 (a) An initial certificate of limited partnership must be signed by all
12 general partners listed in the certificate.
13 (b) An amendment adding or deleting a statement that the limited partner-
14 ship is a limited liability limited partnership must be signed by all gen-
15 eral partners listed in the certificate.
16 (c) An amendment designating as general partner a person admitted under
17 section 53-2-801(3)(b), Idaho Code, following the dissociation of a lim-
18 ited partnership's last general partner must be signed by that person.
19 (d) An amendment required by section 53-2-803(3), Idaho Code, following
20 the appointment of a person to wind up the dissolved limited partnership's
21 activities must be signed by that person.
22 (e) Any other amendment must be signed by:
23 (i) At least one (1) general partner listed in the certificate;
24 (ii) Each other person designated in the amendment as a new general
25 partner; and
26 (iii) Each person that the amendment indicates has dissociated as a
27 general partner, unless:
28 (A) The person is deceased or a guardian or general conservator
29 has been appointed for the person and the amendment so states;
30 or
31 (B) The person has previously delivered to the secretary of
32 state for filing a statement of dissociation.
33 (f) A restated certificate of limited partnership must be signed by at
34 least one (1) general partner listed in the certificate, and, to the
35 extent the restated certificate effects a change under any other paragraph
36 of this subsection, the certificate must be signed in a manner that satis-
37 fies that paragraph.
38 (g) A statement of termination must be signed by all general partners
39 listed in the certificate or, if the certificate of a dissolved limited
40 partnership lists no general partners, by the person appointed pursuant to
41 section 53-2-803(3) or (4), Idaho Code, to wind up the dissolved limited
42 partnership's activities.
43 (h) Articles of conversion must be signed by each general partner listed
44 in the certificate of limited partnership.
45 (i) Articles of merger must be signed as provided in section
46 53-2-1108(1), Idaho Code.
47 (j) Any other record delivered on behalf of a limited partnership to the
48 secretary of state for filing must be signed by at least one (1) general
49 partner listed in the certificate.
50 (k) A statement by a person pursuant to section 53-2-605(1)(d), Idaho
51 Code, stating that the person has dissociated as a general partner must
52 be signed by that person.
53 (l) A statement of withdrawal by a person pursuant to section 53-2-306,
54 Idaho Code, must be signed by that person.
13
1 (m) A record delivered on behalf of a foreign limited partnership to the
2 secretary of state for filing must be signed by at least one (1) general
3 partner of the foreign limited partnership.
4 (n) Any other record delivered on behalf of any person to the secretary
5 of state for filing must be signed by that person.
6 (2) Any person may sign by an attorney in fact any record to be filed
7 pursuant to this chapter.
8 53-2-205. SIGNING AND FILING PURSUANT TO JUDICIAL ORDER. (1) If a person
9 required by this chapter to sign a record or deliver a record to the secretary
10 of state for filing does not do so, any other person that is aggrieved may
11 petition the court to order:
12 (a) The person to sign the record;
13 (b) Deliver the record to the secretary of state for filing; or
14 (c) The secretary of state to file the record unsigned.
15 (2) If the person aggrieved under subsection (1) of this section is not
16 the limited partnership or foreign limited partnership to which the record
17 pertains, the aggrieved person shall make the limited partnership or foreign
18 limited partnership a party to the action. A person aggrieved under subsection
19 (1) of this section may seek the remedies provided in subsection (1) of this
20 section in the same action in combination or in the alternative.
21 (3) A record filed unsigned pursuant to this section is effective without
22 being signed.
23 53-2-206. DELIVERY TO AND FILING OF RECORDS BY SECRETARY OF STATE --
24 EFFECTIVE TIME AND DATE. (1) A record authorized or required to be delivered
25 to the secretary of state for filing under this chapter must be captioned to
26 describe the record's purpose, be in a medium permitted by the secretary of
27 state, and be delivered to the secretary of state. Unless the secretary of
28 state determines that a record does not comply with the filing requirements of
29 this chapter, and if all filing fees have been paid, the secretary of state
30 shall file the record and:
31 (a) For a statement of dissociation, send:
32 (i) A copy of the filed statement and a receipt for the fees to the
33 person which the statement indicates has dissociated as a general
34 partner; and
35 (ii) A copy of the filed statement and receipt to the limited part-
36 nership;
37 (b) For a statement of withdrawal, send:
38 (i) A copy of the filed statement and a receipt for the fees to the
39 person on whose behalf the record was filed; and
40 (ii) If the statement refers to an existing limited partnership, a
41 copy of the filed statement and receipt to the limited partnership;
42 and
43 (c) For all other records, send a copy of the filed record and a receipt
44 for the fees to the person on whose behalf the record was filed.
45 (2) Upon request and payment of a fee, the secretary of state shall send
46 to the requester a certified copy of the requested record.
47 (3) Except as otherwise provided in sections 53-2-116 and 53-2-207, Idaho
48 Code, a record delivered to the secretary of state for filing under this chap-
49 ter may specify an effective time and a delayed effective date. Except as
50 otherwise provided in this chapter, a record filed by the secretary of state
51 is effective:
52 (a) If the record does not specify an effective time and does not specify
53 a delayed effective date, on the date and at the time the record is filed
14
1 as evidenced by the secretary of state's endorsement of the date and time
2 on the record;
3 (b) If the record specifies an effective time but not a delayed effective
4 date, on the date the record is filed at the time specified in the record;
5 (c) If the record specifies a delayed effective date but not an effective
6 time, at 12:01 a.m. on the earlier of:
7 (i) The specified date; or
8 (ii) The ninetieth day after the record is filed; or
9 (d) If the record specifies an effective time and a delayed effective
10 date, at the specified time on the earlier of:
11 (i) The specified date; or
12 (ii) The ninetieth day after the record is filed.
13 53-2-207. CORRECTING FILED RECORD. (1) A limited partnership or foreign
14 limited partnership may deliver to the secretary of state for filing a state-
15 ment of correction to correct a record previously delivered by the limited
16 partnership or foreign limited partnership to the secretary of state and filed
17 by the secretary of state, if at the time of filing the record contained false
18 or erroneous information or was defectively signed.
19 (2) A statement of correction may not state a delayed effective date and
20 must:
21 (a) Describe the record to be corrected, including its filing date, or
22 attach a copy of the record as filed;
23 (b) Specify the incorrect information and the reason it is incorrect or
24 the manner in which the signing was defective; and
25 (c) Correct the incorrect information or defective signature.
26 (3) When filed by the secretary of state, a statement of correction is
27 effective retroactively as of the effective date of the record the statement
28 corrects, but the statement is effective when filed:
29 (a) For the purposes of section 53-2-103(3) and (4), Idaho Code; and
30 (b) As to persons relying on the uncorrected record and adversely
31 affected by the correction.
32 53-2-208. LIABILITY FOR FALSE INFORMATION IN FILED RECORD. (1) If a
33 record delivered to the secretary of state for filing under this chapter and
34 filed by the secretary of state contains false information, a person that suf-
35 fers loss by reliance on the information may recover damages for the loss
36 from:
37 (a) A person that signed the record, or caused another to sign it on the
38 person's behalf, and knew the information to be false at the time the
39 record was signed; and
40 (b) A general partner that has notice that the information was false when
41 the record was filed or has become false because of changed circumstances,
42 if the general partner has notice for a reasonably sufficient time before
43 the information is relied upon to enable the general partner to effect an
44 amendment under section 53-2-202, Idaho Code, file a petition pursuant to
45 section 53-2-205, Idaho Code, or deliver to the secretary of state for
46 filing a statement of change pursuant to section 53-2-115, Idaho Code, or
47 a statement of correction pursuant to section 53-2-207, Idaho Code.
48 (2) Signing a record authorized or required to be filed under this chap-
49 ter constitutes an affirmation under the penalties of perjury that the facts
50 stated in the record are true.
51 53-2-209. CERTIFICATE OF EXISTENCE OR AUTHORIZATION. (1) The secretary of
52 state, upon request and payment of the requisite fee, shall furnish a certifi-
15
1 cate of existence for a limited partnership if the records filed in the office
2 of the secretary of state show that the secretary of state has filed a certif-
3 icate of limited partnership and has not filed a statement of termination. A
4 certificate of existence must state:
5 (a) The limited partnership's name;
6 (b) That it was duly formed under the laws of this state and the date of
7 formation;
8 (c) Whether all fees, taxes, and penalties due to the secretary of state
9 under this chapter or other law have been paid;
10 (d) Whether the limited partnership's most recent annual report required
11 by section 53-2-210, Idaho Code, has been filed by the secretary of state;
12 (e) Whether the secretary of state has administratively dissolved the
13 limited partnership;
14 (f) Whether the limited partnership's certificate of limited partnership
15 has been amended to state that the limited partnership is dissolved;
16 (g) That a statement of termination has not been filed by the secretary
17 of state; and
18 (h) Other facts of record in the office of the secretary of state which
19 may be requested by the applicant.
20 (2) The secretary of state, upon request and payment of the requisite
21 fee, shall furnish a certificate of authorization for a foreign limited part-
22 nership if the records filed in the office of the secretary of state show that
23 the secretary of state has filed a certificate of authority, has not revoked
24 the certificate of authority, and has not filed a notice of cancellation. A
25 certificate of authorization must state:
26 (a) The foreign limited partnership's name and any alternate name adopted
27 under section 53-2-905(1), Idaho Code, for use in this state;
28 (b) That it is authorized to transact business in this state;
29 (c) Whether all fees, taxes, and penalties due to the secretary of state
30 under this chapter or other law have been paid;
31 (d) Whether the foreign limited partnership's most recent annual report
32 required by section 53-2-210, Idaho Code, has been filed by the secretary
33 of state;
34 (e) That the secretary of state has not revoked its certificate of
35 authority and has not filed a notice of cancellation; and
36 (f) Other facts of record in the office of the secretary of state which
37 may be requested by the applicant.
38 (3) Subject to any qualification stated in the certificate, a certificate
39 of existence or authorization issued by the secretary of state may be relied
40 upon as conclusive evidence that the limited partnership or foreign limited
41 partnership is in existence or is authorized to transact business in this
42 state.
43 53-2-210. ANNUAL REPORT FOR SECRETARY OF STATE. (1) A limited partnership
44 or a foreign limited partnership authorized to transact business in this state
45 shall deliver to the secretary of state for filing an annual report that
46 states:
47 (a) The name of the limited partnership or foreign limited partnership;
48 (b) The street and mailing address of its designated office and the name
49 and street and mailing address of its agent for service of process in this
50 state;
51 (c) In the case of a limited partnership, the street and mailing address
52 of its principal office; and
53 (d) In the case of a foreign limited partnership, the state or other
54 jurisdiction under whose law the foreign limited partnership is formed and
16
1 any alternate name adopted under section 53-2-905(1), Idaho Code.
2 (2) Information in an annual report must be current as of the date the
3 annual report is delivered to the secretary of state for filing.
4 (3) The first annual report must be delivered to the secretary of state
5 between January 1 and November 30 of the year following the calendar year in
6 which a limited partnership was formed or a foreign limited partnership was
7 authorized to transact business. An annual report must be delivered to the
8 secretary of state between January 1 and November 30 of each subsequent calen-
9 dar year.
10 (4) If an annual report does not contain the information required in sub-
11 section (1) of this section, the secretary of state shall promptly notify the
12 reporting limited partnership or foreign limited partnership and return the
13 report to it for correction. If the report is corrected to contain the infor-
14 mation required in subsection (1) of this section and delivered to the secre-
15 tary of state within thirty (30) days after the effective date of the notice,
16 it is timely delivered.
17 (5) If a filed annual report contains an address of a designated office
18 or the name or address of an agent for service of process which differs from
19 the information shown in the records of the secretary of state immediately
20 before the filing, the differing information in the annual report is consid-
21 ered a statement of change under section 53-2-115, Idaho Code.
22 PART 3
23 LIMITED PARTNERS
24 53-2-301. BECOMING LIMITED PARTNER. A person becomes a limited partner:
25 (1) As provided in the partnership agreement;
26 (2) As the result of a conversion or merger under part 11 of this chap-
27 ter; or
28 (3) With the consent of all the partners.
29 53-2-302. NO RIGHT OR POWER AS LIMITED PARTNER TO BIND LIMITED PARTNER-
30 SHIP. A limited partner does not have the right or the power as a limited
31 partner to act for or bind the limited partnership.
32 53-2-303. NO LIABILITY AS LIMITED PARTNER FOR LIMITED PARTNERSHIP OBLIGA-
33 TIONS. An obligation of a limited partnership, whether arising in contract,
34 tort, or otherwise, is not the obligation of a limited partner. A limited
35 partner is not personally liable, directly or indirectly, by way of contribu-
36 tion or otherwise, for an obligation of the limited partnership solely by rea-
37 son of being a limited partner, even if the limited partner participates in
38 the management and control of the limited partnership.
39 53-2-304. RIGHT OF LIMITED PARTNER AND FORMER LIMITED PARTNER TO INFORMA-
40 TION. (1) On ten (10) days' demand, made in a record received by the limited
41 partnership, a limited partner may inspect and copy required information dur-
42 ing regular business hours in the limited partnership's designated office. The
43 limited partner need not have any particular purpose for seeking the informa-
44 tion.
45 (2) During regular business hours and at a reasonable location specified
46 by the limited partnership, a limited partner may obtain from the limited
47 partnership and inspect and copy true and full information regarding the state
48 of the activities and financial condition of the limited partnership and other
49 information regarding the activities of the limited partnership as is just and
50 reasonable if:
17
1 (a) The limited partner seeks the information for a purpose reasonably
2 related to the partner's interest as a limited partner;
3 (b) The limited partner makes a demand in a record received by the lim-
4 ited partnership, describing with reasonable particularity the information
5 sought and the purpose for seeking the information; and
6 (c) The information sought is directly connected to the limited partner's
7 purpose.
8 (3) Within ten (10) days after receiving a demand pursuant to subsection
9 (2) of this section, the limited partnership in a record shall inform the lim-
10 ited partner that made the demand:
11 (a) What information the limited partnership will provide in response to
12 the demand;
13 (b) When and where the limited partnership will provide the information;
14 and
15 (c) If the limited partnership declines to provide any demanded informa-
16 tion, the limited partnership's reasons for declining.
17 (4) Subject to subsection (6) of this section, a person dissociated as a
18 limited partner may inspect and copy required information during regular busi-
19 ness hours in the limited partnership's designated office if:
20 (a) The information pertains to the period during which the person was a
21 limited partner;
22 (b) The person seeks the information in good faith; and
23 (c) The person meets the requirements of subsection (2) of this section.
24 (5) The limited partnership shall respond to a demand made pursuant to
25 subsection (4) of this section in the same manner as provided in subsection
26 (3) of this section.
27 (6) If a limited partner dies, section 53-2-704, Idaho Code, applies.
28 (7) The limited partnership may impose reasonable restrictions on the use
29 of information obtained under this section. In a dispute concerning the rea-
30 sonableness of a restriction under this subsection, the limited partnership
31 has the burden of proving reasonableness.
32 (8) A limited partnership may charge a person that makes a demand under
33 this section reasonable costs of copying, limited to the costs of labor and
34 material.
35 (9) Whenever this chapter or a partnership agreement provides for a lim-
36 ited partner to give or withhold consent to a matter, before the consent is
37 given or withheld, the limited partnership shall, without demand, provide the
38 limited partner with all information material to the limited partner's deci-
39 sion that the limited partnership knows.
40 (10) A limited partner or person dissociated as a limited partner may
41 exercise the rights under this section through an attorney or other agent. Any
42 restriction imposed under subsection (7) of this section or by the partnership
43 agreement applies both to the attorney or other agent and to the limited part-
44 ner or person dissociated as a limited partner.
45 (11) The rights stated in this section do not extend to a person as trans-
46 feree, but may be exercised by the legal representative of an individual under
47 legal disability who is a limited partner or person dissociated as a limited
48 partner.
49 53-2-305. LIMITED DUTIES OF LIMITED PARTNERS. (1) A limited partner does
50 not have any fiduciary duty to the limited partnership or to any other partner
51 solely by reason of being a limited partner.
52 (2) A limited partner shall discharge the duties to the partnership and
53 the other partners under this chapter or under the partnership agreement and
54 exercise any rights consistently with the obligation of good faith and fair
18
1 dealing.
2 (3) A limited partner does not violate a duty or obligation under this
3 chapter or under the partnership agreement merely because the limited
4 partner's conduct furthers the limited partner's own interest.
5 53-2-306. PERSON ERRONEOUSLY BELIEVING SELF TO BE LIMITED PARTNER. (1)
6 Except as otherwise provided in subsection (2) of this section, a person that
7 makes an investment in a business enterprise and erroneously but in good faith
8 believes that the person has become a limited partner in the enterprise is not
9 liable for the enterprise's obligations by reason of making the investment,
10 receiving distributions from the enterprise, or exercising any rights of or
11 appropriate to a limited partner, if, on ascertaining the mistake, the person:
12 (a) Causes an appropriate certificate of limited partnership, amendment,
13 or statement of correction to be signed and delivered to the secretary of
14 state for filing; or
15 (b) Withdraws from future participation as an owner in the enterprise by
16 signing and delivering to the secretary of state for filing a statement of
17 withdrawal under this section.
18 (2) A person that makes an investment described in subsection (1) of this
19 section is liable to the same extent as a general partner to any third party
20 that enters into a transaction with the enterprise, believing in good faith
21 that the person is a general partner, before the secretary of state files a
22 statement of withdrawal, certificate of limited partnership, amendment, or
23 statement of correction to show that the person is not a general partner.
24 (3) If a person makes a diligent effort in good faith to comply with sub-
25 section (1)(a) of this section and is unable to cause the appropriate certifi-
26 cate of limited partnership, amendment, or statement of correction to be
27 signed and delivered to the secretary of state for filing, the person has the
28 right to withdraw from the enterprise pursuant to subsection (1)(b) of this
29 section even if the withdrawal would otherwise breach an agreement with others
30 that are or have agreed to become co-owners of the enterprise.
31 PART 4
32 GENERAL PARTNERS
33 53-2-401. BECOMING GENERAL PARTNER. A person becomes a general partner:
34 (1) As provided in the partnership agreement;
35 (2) Under section 53-2-801(3)(b), Idaho Code, following the dissociation
36 of a limited partnership's last general partner;
37 (3) As the result of a conversion or merger under part 11 of this chap-
38 ter; or
39 (4) With the consent of all the partners.
40 53-2-402. GENERAL PARTNER AGENT OF LIMITED PARTNERSHIP. (1) Each general
41 partner is an agent of the limited partnership for the purposes of its activi-
42 ties. An act of a general partner, including the signing of a record in the
43 partnership's name, for apparently carrying on in the ordinary course the lim-
44 ited partnership's activities or activities of the kind carried on by the lim-
45 ited partnership binds the limited partnership, unless the general partner did
46 not have authority to act for the limited partnership in the particular matter
47 and the person with which the general partner was dealing knew, had received a
48 notification, or had notice under section 53-2-103(4), Idaho Code, that the
49 general partner lacked authority.
50 (2) An act of a general partner which is not apparently for carrying on
51 in the ordinary course the limited partnership's activities or activities of
19
1 the kind carried on by the limited partnership binds the limited partnership
2 only if the act was actually authorized by all the other partners.
3 53-2-403. LIMITED PARTNERSHIP LIABLE FOR GENERAL PARTNER'S ACTIONABLE
4 CONDUCT. (1) A limited partnership is liable for loss or injury caused to a
5 person, or for a penalty incurred, as a result of a wrongful act or omission,
6 or other actionable conduct, of a general partner acting in the ordinary
7 course of activities of the limited partnership or with authority of the lim-
8 ited partnership.
9 (2) If, in the course of the limited partnership's activities or while
10 acting with authority of the limited partnership, a general partner receives
11 or causes the limited partnership to receive money or property of a person not
12 a partner, and the money or property is misapplied by a general partner, the
13 limited partnership is liable for the loss.
14 53-2-404. GENERAL PARTNER'S LIABILITY. (1) Except as otherwise provided
15 in subsections (2) and (3) of this section, all general partners are liable
16 jointly and severally for all obligations of the limited partnership unless
17 otherwise agreed by the claimant or provided by law.
18 (2) A person that becomes a general partner of an existing limited part-
19 nership is not personally liable for an obligation of a limited partnership
20 incurred before the person became a general partner.
21 (3) An obligation of a limited partnership incurred while the limited
22 partnership is a limited liability limited partnership, whether arising in
23 contract, tort, or otherwise, is solely the obligation of the limited partner-
24 ship. A general partner is not personally liable, directly or indirectly, by
25 way of contribution or otherwise, for such an obligation solely by reason of
26 being or acting as a general partner. This subsection (3) applies despite any-
27 thing inconsistent in the partnership agreement that existed immediately
28 before the consent required to become a limited liability limited partnership
29 under section 53-2-406(2)(b), Idaho Code.
30 53-2-405. ACTIONS BY AND AGAINST PARTNERSHIP AND PARTNERS. (1) To the
31 extent not inconsistent with section 53-2-404, Idaho Code, a general partner
32 may be joined in an action against the limited partnership or named in a sepa-
33 rate action.
34 (2) A judgment against a limited partnership is not by itself a judgment
35 against a general partner. A judgment against a limited partnership may not be
36 satisfied from a general partner's assets unless there is also a judgment
37 against the general partner.
38 (3) A judgment creditor of a general partner may not levy execution
39 against the assets of the general partner to satisfy a judgment based on a
40 claim against the limited partnership, unless the partner is personally liable
41 for the claim under section 53-2-404, Idaho Code, and:
42 (a) A judgment based on the same claim has been obtained against the lim-
43 ited partnership and a writ of execution on the judgment has been returned
44 unsatisfied in whole or in part;
45 (b) The limited partnership is a debtor in bankruptcy;
46 (c) The general partner has agreed that the creditor need not exhaust
47 limited partnership assets;
48 (d) A court grants permission to the judgment creditor to levy execution
49 against the assets of a general partner based on a finding that limited
50 partnership assets subject to execution are clearly insufficient to sat-
51 isfy the judgment, that exhaustion of limited partnership assets is exces-
52 sively burdensome, or that the grant of permission is an appropriate exer-
20
1 cise of the court's equitable powers; or
2 (e) Liability is imposed on the general partner by law or contract inde-
3 pendent of the existence of the limited partnership.
4 53-2-406. MANAGEMENT RIGHTS OF GENERAL PARTNER. (1) Each general partner
5 has equal rights in the management and conduct of the limited partnership's
6 activities. Except as expressly provided in this chapter, any matter relating
7 to the activities of the limited partnership may be exclusively decided by the
8 general partner or, if there is more than one (1) general partner, by a major-
9 ity of the general partners.
10 (2) The consent of each partner is necessary to:
11 (a) Amend the partnership agreement;
12 (b) Amend the certificate of limited partnership to add or, subject to
13 section 53-2-1110, Idaho Code, delete a statement that the limited part-
14 nership is a limited liability limited partnership; and
15 (c) Sell, lease, exchange, or otherwise dispose of all, or substantially
16 all, of the limited partnership's property, with or without the good will,
17 other than in the usual and regular course of the limited partnership's
18 activities.
19 (3) A limited partnership shall reimburse a general partner for payments
20 made and indemnify a general partner for liabilities incurred by the general
21 partner in the ordinary course of the activities of the partnership or for the
22 preservation of its activities or property.
23 (4) A limited partnership shall reimburse a general partner for an
24 advance to the limited partnership beyond the amount of capital the general
25 partner agreed to contribute.
26 (5) A payment or advance made by a general partner which gives rise to an
27 obligation of the limited partnership under subsection (3) or (4) of this sec-
28 tion constitutes a loan to the limited partnership which accrues interest from
29 the date of the payment or advance.
30 (6) A general partner is not entitled to remuneration for services per-
31 formed for the partnership.
32 53-2-407. RIGHT OF GENERAL PARTNER AND FORMER GENERAL PARTNER TO INFORMA-
33 TION. (1) A general partner, without having any particular purpose for seeking
34 the information, may inspect and copy during regular business hours:
35 (a) In the limited partnership's designated office, required information;
36 and
37 (b) At a reasonable location specified by the limited partnership, any
38 other records maintained by the limited partnership regarding the limited
39 partnership's activities and financial condition.
40 (2) Each general partner and the limited partnership shall furnish to a
41 general partner:
42 (a) Without demand, any information concerning the limited partnership's
43 activities and activities reasonably required for the proper exercise of
44 the general partner's rights and duties under the partnership agreement or
45 this chapter; and
46 (b) On demand, any other information concerning the limited partnership's
47 activities, except to the extent the demand or the information demanded is
48 unreasonable or otherwise improper under the circumstances.
49 (3) Subject to subsection (5) of this section, on ten (10) days' demand
50 made in a record received by the limited partnership, a person dissociated as
51 a general partner may have access to the information and records described in
52 subsection (1) of this section at the location specified in subsection (1) if:
53 (a) The information or record pertains to the period during which the
21
1 person was a general partner;
2 (b) The person seeks the information or record in good faith; and
3 (c) The person satisfies the requirements imposed on a limited partner by
4 section 53-2-304(2), Idaho Code.
5 (4) The limited partnership shall respond to a demand made pursuant to
6 subsection (3) of this section in the same manner as provided in section
7 53-2-304(3), Idaho Code.
8 (5) If a general partner dies, section 53-2-704, Idaho Code, applies.
9 (6) The limited partnership may impose reasonable restrictions on the use
10 of information under this section. In any dispute concerning the reasonable-
11 ness of a restriction under this subsection, the limited partnership has the
12 burden of proving reasonableness.
13 (7) A limited partnership may charge a person dissociated as a general
14 partner that makes a demand under this section reasonable costs of copying,
15 limited to the costs of labor and material.
16 (8) A general partner or person dissociated as a general partner may
17 exercise the rights under this section through an attorney or other agent. Any
18 restriction imposed under subsection (6) of this section or by the partnership
19 agreement applies both to the attorney or other agent and to the general part-
20 ner or person dissociated as a general partner.
21 (9) The rights under this section do not extend to a person as trans-
22 feree, but the rights under subsection (3) of this section of a person
23 dissociated as a general may be exercised by the legal representative of an
24 individual who dissociated as a general partner under section 53-2-603(7)(b)
25 or (c), Idaho Code.
26 53-2-408. GENERAL STANDARDS OF GENERAL PARTNER'S CONDUCT. (1) The only
27 fiduciary duties that a general partner has to the limited partnership and the
28 other partners are the duties of loyalty and care under subsections (2) and
29 (3) of this section.
30 (2) A general partner's duty of loyalty to the limited partnership and
31 the other partners is limited to the following:
32 (a) To account to the limited partnership and hold as trustee for it any
33 property, profit, or benefit derived by the general partner in the conduct
34 and winding up of the limited partnership's activities or derived from a
35 use by the general partner of limited partnership property, including the
36 appropriation of a limited partnership opportunity;
37 (b) To refrain from dealing with the limited partnership in the conduct
38 or winding up of the limited partnership's activities as or on behalf of a
39 party having an interest adverse to the limited partnership; and
40 (c) To refrain from competing with the limited partnership in the conduct
41 or winding up of the limited partnership's activities.
42 (3) A general partner's duty of care to the limited partnership and the
43 other partners in the conduct and winding up of the limited partnership's
44 activities is limited to refraining from engaging in grossly negligent or
45 reckless conduct, intentional misconduct, or a knowing violation of law.
46 (4) A general partner shall discharge the duties to the partnership and
47 the other partners under this chapter or under the partnership agreement and
48 exercise any rights consistently with the obligation of good faith and fair
49 dealing.
50 (5) A general partner does not violate a duty or obligation under this
51 chapter or under the partnership agreement merely because the general
52 partner's conduct furthers the general partner's own interest.
22
1 PART 5
2 CONTRIBUTIONS AND DISTRIBUTIONS
3 53-2-501. FORM OF CONTRIBUTION. A contribution of a partner may consist
4 of tangible or intangible property or other benefit to the limited partner-
5 ship, including money, services performed, promissory notes, other agreements
6 to contribute cash or property, and contracts for services to be performed.
7 53-2-502. LIABILITY FOR CONTRIBUTION. (1) A partner's obligation to con-
8 tribute money or other property or other benefit to, or to perform services
9 for, a limited partnership is not excused by the partner's death, disability,
10 or other inability to perform personally.
11 (2) If a partner does not make a promised nonmonetary contribution, the
12 partner is obligated at the option of the limited partnership to contribute
13 money equal to that portion of the value, as stated in the required informa-
14 tion, of the stated contribution which has not been made.
15 (3) The obligation of a partner to make a contribution or return money or
16 other property paid or distributed in violation of this chapter may be compro-
17 mised only by consent of all partners. A creditor of a limited partnership
18 which extends credit or otherwise acts in reliance on an obligation described
19 in subsection (1) of this section, without notice of any compromise under this
20 subsection, may enforce the original obligation.
21 53-2-503. SHARING OF DISTRIBUTIONS. A distribution by a limited partner-
22 ship must be shared among the partners on the basis of the value, as stated in
23 the required records when the limited partnership decides to make the distri-
24 bution, of the contributions the limited partnership has received from each
25 partner.
26 53-2-504. INTERIM DISTRIBUTIONS. A partner does not have a right to any
27 distribution before the dissolution and winding up of the limited partnership
28 unless the limited partnership decides to make an interim distribution.
29 53-2-505. NO DISTRIBUTION ON ACCOUNT OF DISSOCIATION. A person does not
30 have a right to receive a distribution on account of dissociation.
31 53-2-506. DISTRIBUTION IN KIND. A partner does not have a right to demand
32 or receive any distribution from a limited partnership in any form other than
33 cash. Subject to section 53-2-812(2), Idaho Code, a limited partnership may
34 distribute an asset in kind to the extent each partner receives a percentage
35 of the asset equal to the partner's share of distributions.
36 53-2-507. RIGHT TO DISTRIBUTION. When a partner or transferee becomes
37 entitled to receive a distribution, the partner or transferee has the status
38 of, and is entitled to all remedies available to, a creditor of the limited
39 partnership with respect to the distribution. However, the limited
40 partnership's obligation to make a distribution is subject to offset for any
41 amount owed to the limited partnership by the partner or dissociated partner
42 on whose account the distribution is made.
43 53-2-508. LIMITATIONS ON DISTRIBUTION. (1) A limited partnership may not
44 make a distribution in violation of the partnership agreement.
45 (2) A limited partnership may not make a distribution if after the dis-
46 tribution:
47 (a) The limited partnership would not be able to pay its debts as they
23
1 become due in the ordinary course of the limited partnership's activities;
2 or
3 (b) The limited partnership's total assets would be less than the sum of
4 its total liabilities plus the amount that would be needed, if the limited
5 partnership were to be dissolved, wound up, and terminated at the time of
6 the distribution, to satisfy the preferential rights upon dissolution,
7 winding up, and termination of partners whose preferential rights are
8 superior to those of persons receiving the distribution.
9 (3) A limited partnership may base a determination that a distribution is
10 not prohibited under subsection (2) of this section on financial statements
11 prepared on the basis of accounting practices and principles that are reason-
12 able in the circumstances or on a fair valuation or other method that is rea-
13 sonable in the circumstances.
14 (4) Except as otherwise provided in subsection (6) of this section, the
15 effect of a distribution under subsection (2) of this section is measured:
16 (a) In the case of distribution by purchase, redemption, or other acqui-
17 sition of a transferable interest in the limited partnership, as of the
18 date money or other property is transferred or debt incurred by the lim-
19 ited partnership; and
20 (b) In all other cases, as of the date:
21 (i) The distribution is authorized, if the payment occurs within
22 one hundred twenty (120) days after that date; or
23 (ii) The payment is made, if payment occurs more than one hundred
24 twenty (120) days after the distribution is authorized.
25 (5) A limited partnership's indebtedness to a partner incurred by reason
26 of a distribution made in accordance with this section is at parity with the
27 limited partnership's indebtedness to its general, unsecured creditors.
28 (6) A limited partnership's indebtedness, including indebtedness issued
29 in connection with or as part of a distribution, is not considered a liability
30 for purposes of subsection (2) of this section if the terms of the indebted-
31 ness provide that payment of principal and interest are made only to the
32 extent that a distribution could then be made to partners under this section.
33 (7) If indebtedness is issued as a distribution, each payment of princi-
34 pal or interest on the indebtedness is treated as a distribution, the effect
35 of which is measured on the date the payment is made.
36 53-2-509. LIABILITY FOR IMPROPER DISTRIBUTIONS. (1) A general partner
37 that consents to a distribution made in violation of section 53-2-508, Idaho
38 Code, is personally liable to the limited partnership for the amount of the
39 distribution which exceeds the amount that could have been distributed without
40 the violation if it is established that in consenting to the distribution the
41 general partner failed to comply with section 53-2-408, Idaho Code.
42 (2) A partner or transferee that received a distribution knowing that the
43 distribution to that partner or transferee was made in violation of section
44 53-2-508, Idaho Code, is personally liable to the limited partnership but only
45 to the extent that the distribution received by the partner or transferee
46 exceeded the amount that could have been properly paid under section 53-2-508,
47 Idaho Code.
48 (3) A general partner against which an action is commenced under subsec-
49 tion (1) of this section may:
50 (a) Implead in the action any other person that is liable under subsec-
51 tion (1) of this section and compel contribution from the person; and
52 (b) Implead in the action any person that received a distribution in
53 violation of subsection (2) of this section and compel contribution from
54 the person in the amount the person received in violation of subsection
24
1 (2) of this section.
2 (4) An action under this section is barred if it is not commenced within
3 two (2) years after the distribution.
4 PART 6
5 DISSOCIATION
6 53-2-601. DISSOCIATION AS LIMITED PARTNER. (1) A person does not have a
7 right to dissociate as a limited partner before the termination of the limited
8 partnership.
9 (2) A person is dissociated from a limited partnership as a limited part-
10 ner upon the occurrence of any of the following events:
11 (a) The limited partnership's having notice of the person's express will
12 to withdraw as a limited partner or on a later date specified by the per-
13 son;
14 (b) An event agreed to in the partnership agreement as causing the
15 person's dissociation as a limited partner;
16 (c) The person's expulsion as a limited partner pursuant to the partner-
17 ship agreement;
18 (d) The person's expulsion as a limited partner by the unanimous consent
19 of the other partners if:
20 (i) It is unlawful to carry on the limited partnership's activities
21 with the person as a limited partner;
22 (ii) There has been a transfer of all of the person's transferable
23 interest in the limited partnership, other than a transfer for secu-
24 rity purposes, or a court order charging the person's interest, which
25 has not been foreclosed;
26 (iii) The person is a corporation and, within ninety (90) days after
27 the limited partnership notifies the person that it will be expelled
28 as a limited partner because it has filed a certificate of dissolu-
29 tion or the equivalent, its charter has been revoked, or its right to
30 conduct business has been suspended by the jurisdiction of its incor-
31 poration, there is no revocation of the certificate of dissolution or
32 no reinstatement of its charter or its right to conduct business; or
33 (iv) The person is a limited liability company or partnership that
34 has been dissolved and whose business is being wound up;
35 (e) On application by the limited partnership, the person's expulsion as
36 a limited partner by judicial order because:
37 (i) The person engaged in wrongful conduct that adversely and mate-
38 rially affected the limited partnership's activities;
39 (ii) The person willfully or persistently committed a material
40 breach of the partnership agreement or of the obligation of good
41 faith and fair dealing under section 53-2-305(2), Idaho Code; or
42 (iii) The person engaged in conduct relating to the limited
43 partnership's activities which makes it not reasonably practicable to
44 carry on the activities with the person as limited partner;
45 (f) In the case of a person who is an individual, the person's death;
46 (g) In the case of a person that is a trust or is acting as a limited
47 partner by virtue of being a trustee of a trust, distribution of the
48 trust's entire transferable interest in the limited partnership, but not
49 merely by reason of the substitution of a successor trustee;
50 (h) In the case of a person that is an estate or is acting as a limited
51 partner by virtue of being a personal representative of an estate, distri-
52 bution of the estate's entire transferable interest in the limited part-
53 nership, but not merely by reason of the substitution of a successor per-
25
1 sonal representative;
2 (i) Termination of a limited partner that is not an individual, partner-
3 ship, limited liability company, corporation, trust, or estate;
4 (j) The limited partnership's participation in a conversion or merger
5 under part 11 of this chapter, if the limited partnership:
6 (i) Is not the converted or surviving entity; or
7 (ii) Is the converted or surviving entity but, as a result of the
8 conversion or merger, the person ceases to be a limited partner.
9 53-2-602. EFFECT OF DISSOCIATION AS LIMITED PARTNER. (1) Upon a person's
10 dissociation as a limited partner:
11 (a) Subject to section 53-2-704, Idaho Code, the person does not have
12 further rights as a limited partner;
13 (b) The person's obligation of good faith and fair dealing as a limited
14 partner under section 53-2-305(2), Idaho Code, continues only as to mat-
15 ters arising and events occurring before the dissociation; and
16 (c) Subject to section 53-2-704, Idaho Code, and part 11 of this chapter,
17 any transferable interest owned by the person in the person's capacity as
18 a limited partner immediately before dissociation is owned by the person
19 as a mere transferee.
20 (2) A person's dissociation as a limited partner does not of itself dis-
21 charge the person from any obligation to the limited partnership or the other
22 partners which the person incurred while a limited partner.
23 53-2-603. DISSOCIATION AS GENERAL PARTNER. A person is dissociated from a
24 limited partnership as a general partner upon the occurrence of any of the
25 following events:
26 (1) The limited partnership's having notice of the person's express will
27 to withdraw as a general partner or on a later date specified by the person;
28 (2) An event agreed to in the partnership agreement as causing the
29 person's dissociation as a general partner;
30 (3) The person's expulsion as a general partner pursuant to the partner-
31 ship agreement;
32 (4) The person's expulsion as a general partner by the unanimous consent
33 of the other partners if:
34 (a) It is unlawful to carry on the limited partnership's activities with
35 the person as a general partner;
36 (b) There has been a transfer of all or substantially all of the person's
37 transferable interest in the limited partnership, other than a transfer
38 for security purposes, or a court order charging the person's interest,
39 which has not been foreclosed;
40 (c) The person is a corporation and, within ninety (90) days after the
41 limited partnership notifies the person that it will be expelled as a gen-
42 eral partner because it has filed a certificate of dissolution or the
43 equivalent, its charter has been revoked, or its right to conduct business
44 has been suspended by the jurisdiction of its incorporation, there is no
45 revocation of the certificate of dissolution or no reinstatement of its
46 charter or its right to conduct business; or
47 (d) The person is a limited liability company or partnership that has
48 been dissolved and whose business is being wound up;
49 (5) On application by the limited partnership, the person's expulsion as
50 a general partner by judicial determination because:
51 (a) The person engaged in wrongful conduct that adversely and materially
52 affected the limited partnership activities;
53 (b) The person willfully or persistently committed a material breach of
26
1 the partnership agreement or of a duty owed to the partnership or the
2 other partners under section 53-2-408, Idaho Code; or
3 (c) The person engaged in conduct relating to the limited partnership's
4 activities which makes it not reasonably practicable to carry on the
5 activities of the limited partnership with the person as a general part-
6 ner;
7 (6) The person's:
8 (a) Becoming a debtor in bankruptcy;
9 (b) Execution of an assignment for the benefit of creditors;
10 (c) Seeking, consenting to, or acquiescing in the appointment of a
11 trustee, receiver, or liquidator of the person or of all or substantially
12 all of the person's property; or
13 (d) Failure, within ninety (90) days after the appointment, to have
14 vacated or stayed the appointment of a trustee, receiver, or liquidator of
15 the general partner or of all or substantially all of the person's prop-
16 erty obtained without the person's consent or acquiescence, or failing
17 within ninety (90) days after the expiration of a stay to have the
18 appointment vacated;
19 (7) In the case of a person who is an individual:
20 (a) The person's death;
21 (b) The appointment of a guardian or general conservator for the person;
22 or
23 (c) A judicial determination that the person has otherwise become incapa-
24 ble of performing the person's duties as a general partner under the part-
25 nership agreement;
26 (8) In the case of a person that is a trust or is acting as a general
27 partner by virtue of being a trustee of a trust, distribution of the trust's
28 entire transferable interest in the limited partnership, but not merely by
29 reason of the substitution of a successor trustee;
30 (9) In the case of a person that is an estate or is acting as a general
31 partner by virtue of being a personal representative of an estate, distribu-
32 tion of the estate's entire transferable interest in the limited partnership,
33 but not merely by reason of the substitution of a successor personal represen-
34 tative;
35 (10) Termination of a general partner that is not an individual, partner-
36 ship, limited liability company, corporation, trust, or estate; or
37 (11) The limited partnership's participation in a conversion or merger
38 under part 11 of this chapter, if the limited partnership:
39 (a) Is not the converted or surviving entity; or
40 (b) Is the converted or surviving entity but, as a result of the conver-
41 sion or merger, the person ceases to be a general partner.
42 53-2-604. PERSON'S POWER TO DISSOCIATE AS GENERAL PARTNER -- WRONGFUL
43 DISSOCIATION. (1) A person has the power to dissociate as a general partner at
44 any time, rightfully or wrongfully, by express will pursuant to section
45 53-2-603(1), Idaho Code.
46 (2) A person's dissociation as a general partner is wrongful only if:
47 (a) It is in breach of an express provision of the partnership agreement;
48 or
49 (b) It occurs before the termination of the limited partnership, and:
50 (i) The person withdraws as a general partner by express will;
51 (ii) The person is expelled as a general partner by judicial deter-
52 mination under section 53-2-603(5), Idaho Code;
53 (iii) The person is dissociated as a general partner by becoming a
54 debtor in bankruptcy; or
27
1 (iv) In the case of a person that is not an individual, trust other
2 than a business trust, or estate, the person is expelled or otherwise
3 dissociated as a general partner because it willfully dissolved or
4 terminated.
5 (3) A person that wrongfully dissociates as a general partner is liable
6 to the limited partnership and, subject to section 53-2-1001, Idaho Code, to
7 the other partners for damages caused by the dissociation. The liability is in
8 addition to any other obligation of the general partner to the limited part-
9 nership or to the other partners.
10 53-2-605. EFFECT OF DISSOCIATION AS GENERAL PARTNER. (1) Upon a person's
11 dissociation as a general partner:
12 (a) The person's right to participate as a general partner in the manage-
13 ment and conduct of the partnership's activities terminates;
14 (b) The person's duty of loyalty as a general partner under section
15 53-2-408(2)(c), Idaho Code, terminates;
16 (c) The person's duty of loyalty as a general partner under section
17 53-2-408(2)(a) and (b), Idaho Code, and duty of care under section
18 53-2-408(3), Idaho Code, continue only with regard to matters arising and
19 events occurring before the person's dissociation as a general partner;
20 (d) The person may sign and deliver to the secretary of state for filing
21 a statement of dissociation pertaining to the person and, at the request
22 of the limited partnership, shall sign an amendment to the certificate of
23 limited partnership which states that the person has dissociated; and
24 (e) Subject to section 53-2-704, Idaho Code, and part 11 of this chapter,
25 any transferable interest owned by the person immediately before dissocia-
26 tion in the person's capacity as a general partner is owned by the person
27 as a mere transferee.
28 (2) A person's dissociation as a general partner does not of itself dis-
29 charge the person from any obligation to the limited partnership or the other
30 partners which the person incurred while a general partner.
31 53-2-606. POWER TO BIND AND LIABILITY TO LIMITED PARTNERSHIP BEFORE DIS-
32 SOLUTION OF PARTNERSHIP OF PERSON DISSOCIATED AS GENERAL PARTNER. (1) After a
33 person is dissociated as a general partner and before the limited partnership
34 is dissolved, converted under part 11 of this chapter, or merged out of exis-
35 tence under part 11 of this chapter, the limited partnership is bound by an
36 act of the person only if:
37 (a) The act would have bound the limited partnership under section
38 53-2-402, Idaho Code, before the dissociation; and
39 (b) At the time the other party enters into the transaction:
40 (i) Less than two (2) years has passed since the dissociation; and
41 (ii) The other party does not have notice of the dissociation and
42 reasonably believes that the person is a general partner.
43 (2) If a limited partnership is bound under subsection (1) of this sec-
44 tion, the person dissociated as a general partner which caused the limited
45 partnership to be bound is liable:
46 (a) To the limited partnership for any damage caused to the limited part-
47 nership arising from the obligation incurred under subsection (1) of this
48 section; and
49 (b) If a general partner or another person dissociated as a general part-
50 ner is liable for the obligation, to the general partner or other person
51 for any damage caused to the general partner or other person arising from
52 the liability.
28
1 53-2-607. LIABILITY TO OTHER PERSONS OF PERSON DISSOCIATED AS GENERAL
2 PARTNER. (1) A person's dissociation as a general partner does not of itself
3 discharge the person's liability as a general partner for an obligation of the
4 limited partnership incurred before dissociation. Except as otherwise provided
5 in subsections (2) and (3) of this section, the person is not liable for a
6 limited partnership's obligation incurred after dissociation.
7 (2) A person whose dissociation as a general partner resulted in a disso-
8 lution and winding up of the limited partnership's activities is liable to
9 the same extent as a general partner under section 53-2-404, Idaho Code, on an
10 obligation incurred by the limited partnership under section 53-2-804, Idaho
11 Code.
12 (3) A person that has dissociated as a general partner but whose dissoci-
13 ation did not result in a dissolution and winding up of the limited
14 partnership's activities is liable on a transaction entered into by the lim-
15 ited partnership after the dissociation only if:
16 (a) A general partner would be liable on the transaction; and
17 (b) At the time the other party enters into the transaction:
18 (i) Less than two (2) years has passed since the dissociation; and
19 (ii) The other party does not have notice of the dissociation and
20 reasonably believes that the person is a general partner.
21 (4) By agreement with a creditor of a limited partnership and the limited
22 partnership, a person dissociated as a general partner may be released from
23 liability for an obligation of the limited partnership.
24 (5) A person dissociated as a general partner is released from liability
25 for an obligation of the limited partnership if the limited partnership's
26 creditor, with notice of the person's dissociation as a general partner but
27 without the person's consent, agrees to a material alteration in the nature or
28 time of payment of the obligation.
29 PART 7
30 TRANSFERABLE INTERESTS AND RIGHTS
31 OF TRANSFEREES AND CREDITORS
32 53-2-701. PARTNER'S TRANSFERABLE INTEREST. The only interest of a partner
33 which is transferable is the partner's transferable interest. A transferable
34 interest is personal property.
35 53-2-702. TRANSFER OF PARTNER'S TRANSFERABLE INTEREST. (1) A transfer, in
36 whole or in part, of a partner's transferable interest:
37 (a) Is permissible;
38 (b) Does not by itself cause the partner's dissociation or a dissolution
39 and winding up of the limited partnership's activities; and
40 (c) Does not, as against the other partners or the limited partnership,
41 entitle the transferee to participate in the management or conduct of the
42 limited partnership's activities, to require access to information con-
43 cerning the limited partnership's transactions except as otherwise pro-
44 vided in subsection (3) of this section, or to inspect or copy the
45 required information or the limited partnership's other records.
46 (2) A transferee has a right to receive, in accordance with the transfer:
47 (a) Distributions to which the transferor would otherwise be entitled;
48 and
49 (b) Upon the dissolution and winding up of the limited partnership's
50 activities the net amount otherwise distributable to the transferor.
51 (3) In a dissolution and winding up, a transferee is entitled to an
52 account of the limited partnership's transactions only from the date of disso-
29
1 lution.
2 (4) Upon transfer, the transferor retains the rights of a partner other
3 than the interest in distributions transferred and retains all duties and
4 obligations of a partner.
5 (5) A limited partnership need not give effect to a transferee's rights
6 under this section until the limited partnership has notice of the transfer.
7 (6) A transfer of a partner's transferable interest in the limited part-
8 nership in violation of a restriction on transfer contained in the partnership
9 agreement is ineffective as to a person having notice of the restriction at
10 the time of transfer.
11 (7) A transferee that becomes a partner with respect to a transferable
12 interest is liable for the transferor's obligations under sections 53-2-502
13 and 53-2-509, Idaho Code. However, the transferee is not obligated for liabil-
14 ities unknown to the transferee at the time the transferee became a partner.
15 53-2-703. RIGHTS OF CREDITOR OF PARTNER OR TRANSFEREE. (1) On application
16 to a court of competent jurisdiction by any judgment creditor of a partner or
17 transferee, the court may charge the transferable interest of the judgment
18 debtor with payment of the unsatisfied amount of the judgment with interest.
19 To the extent so charged, the judgment creditor has only the rights of a
20 transferee. The court may appoint a receiver of the share of the distributions
21 due or to become due to the judgment debtor in respect of the partnership and
22 make all other orders, directions, accounts, and inquiries the judgment debtor
23 might have made or which the circumstances of the case may require to give
24 effect to the charging order.
25 (2) A charging order constitutes a lien on the judgment debtor's trans-
26 ferable interest. The court may order a foreclosure upon the interest subject
27 to the charging order at any time. The purchaser at the foreclosure sale has
28 the rights of a transferee.
29 (3) At any time before foreclosure, an interest charged may be redeemed:
30 (a) By the judgment debtor;
31 (b) With property other than limited partnership property, by one (1) or
32 more of the other partners; or
33 (c) With limited partnership property, by the limited partnership with
34 the consent of all partners whose interests are not so charged.
35 (4) This chapter does not deprive any partner or transferee of the bene-
36 fit of any exemption laws applicable to the partner's or transferee's trans-
37 ferable interest.
38 (5) This section provides the exclusive remedy by which a judgment credi-
39 tor of a partner or transferee may satisfy a judgment out of the judgment
40 debtor's transferable interest.
41 53-2-704. POWER OF ESTATE OF DECEASED PARTNER. If a partner dies, the
42 deceased partner's personal representative or other legal representative may
43 exercise the rights of a transferee as provided in section 53-2-702, Idaho
44 Code, and, for the purposes of settling the estate, may exercise the rights of
45 a current limited partner under section 53-2-304, Idaho Code.
46 PART 8
47 DISSOLUTION
48 53-2-801. NONJUDICIAL DISSOLUTION. Except as otherwise provided in sec-
49 tion 53-2-802, Idaho Code, a limited partnership is dissolved, and its activi-
50 ties must be wound up, only upon the occurrence of any of the following:
51 (1) The happening of an event specified in the partnership agreement;
30
1 (2) The consent of all general partners and of limited partners owning a
2 majority of the rights to receive distributions as limited partners at the
3 time the consent is to be effective;
4 (3) After the dissociation of a person as a general partner:
5 (a) If the limited partnership has at least one (1) remaining general
6 partner, the consent to dissolve the limited partnership given within
7 ninety (90) days after the dissociation by partners owning a majority of
8 the rights to receive distributions as partners at the time the consent is
9 to be effective; or
10 (b) If the limited partnership does not have a remaining general partner,
11 the passage of ninety (90) days after the dissociation, unless before the
12 end of the period:
13 (i) Consent to continue the activities of the limited partnership
14 and admit at least one (1) general partner is given by limited part-
15 ners owning a majority of the rights to receive distributions as lim-
16 ited partners at the time the consent is to be effective; and
17 (ii) At least one (1) person is admitted as a general partner in
18 accordance with the consent;
19 (4) The passage of ninety (90) days after the dissociation of the limited
20 partnership's last limited partner, unless before the end of the period the
21 limited partnership admits at least one (1) limited partner; or
22 (5) The signing and filing of a declaration of dissolution by the secre-
23 tary of state under section 53-2-809(3), Idaho Code.
24 53-2-802. JUDICIAL DISSOLUTION. On application by a partner the court may
25 order dissolution of a limited partnership if it is not reasonably practicable
26 to carry on the activities of the limited partnership in conformity with the
27 partnership agreement.
28 53-2-803. WINDING UP. (1) A limited partnership continues after dissolu-
29 tion only for the purpose of winding up its activities.
30 (2) In winding up its activities, the limited partnership:
31 (a) May amend its certificate of limited partnership to state that the
32 limited partnership is dissolved, preserve the limited partnership busi-
33 ness or property as a going concern for a reasonable time, prosecute and
34 defend actions and proceedings, whether civil, criminal, or administra-
35 tive, transfer the limited partnership's property, settle disputes by
36 mediation or arbitration, file a statement of termination as provided in
37 section 53-2-203, Idaho Code, and perform other necessary acts; and
38 (b) Shall discharge the limited partnership's liabilities, settle and
39 close the limited partnership's activities, and marshal and distribute the
40 assets of the partnership.
41 (3) If a dissolved limited partnership does not have a general partner, a
42 person to wind up the dissolved limited partnership's activities may be
43 appointed by the consent of limited partners owning a majority of the rights
44 to receive distributions as limited partners at the time the consent is to be
45 effective. A person appointed under this subsection:
46 (a) Has the powers of a general partner under section 53-2-804, Idaho
47 Code; and
48 (b) Shall promptly amend the certificate of limited partnership to state:
49 (i) That the limited partnership does not have a general partner;
50 (ii) The name of the person that has been appointed to wind up the
51 limited partnership; and
52 (iii) The street and mailing address of the person.
53 (4) On the application of any partner, the court may order judicial
31
1 supervision of the winding up, including the appointment of a person to wind
2 up the dissolved limited partnership's activities, if:
3 (a) A limited partnership does not have a general partner and within a
4 reasonable time following the dissolution no person has been appointed
5 pursuant to subsection (3) of this section; or
6 (b) The applicant establishes other good cause.
7 53-2-804. POWER OF GENERAL PARTNER AND PERSON DISSOCIATED AS GENERAL
8 PARTNER TO BIND PARTNERSHIP AFTER DISSOLUTION. (1) A limited partnership is
9 bound by a general partner's act after dissolution which:
10 (a) Is appropriate for winding up the limited partnership's activities;
11 or
12 (b) Would have bound the limited partnership under section 53-2-402,
13 Idaho Code, before dissolution, if, at the time the other party enters
14 into the transaction, the other party does not have notice of the dissolu-
15 tion.
16 (2) A person dissociated as a general partner binds a limited partnership
17 through an act occurring after dissolution if:
18 (a) At the time the other party enters into the transaction:
19 (i) Less than two (2) years has passed since the dissociation; and
20 (ii) The other party does not have notice of the dissociation and
21 reasonably believes that the person is a general partner; and
22 (b) The act:
23 (i) Is appropriate for winding up the limited partnership's activi-
24 ties; or
25 (ii) Would have bound the limited partnership under section
26 53-2-402, Idaho Code, before dissolution and at the time the other
27 party enters into the transaction the other party does not have
28 notice of the dissolution.
29 53-2-805. LIABILITY AFTER DISSOLUTION OF GENERAL PARTNER AND PERSON
30 DISSOCIATED AS GENERAL PARTNER TO LIMITED PARTNERSHIP, OTHER GENERAL PARTNERS,
31 AND PERSONS DISSOCIATED AS GENERAL PARTNER. (1) If a general partner having
32 knowledge of the dissolution causes a limited partnership to incur an obliga-
33 tion under section 53-2-804(1), Idaho Code, by an act that is not appropriate
34 for winding up the partnership's activities, the general partner is liable:
35 (a) To the limited partnership for any damage caused to the limited part-
36 nership arising from the obligation; and
37 (b) If another general partner or a person dissociated as a general part-
38 ner is liable for the obligation, to that other general partner or person
39 for any damage caused to that other general partner or person arising from
40 the liability.
41 (2) If a person dissociated as a general partner causes a limited part-
42 nership to incur an obligation under section 53-2-804(2), Idaho Code, the per-
43 son is liable:
44 (a) To the limited partnership for any damage caused to the limited part-
45 nership arising from the obligation; and
46 (b) If a general partner or another person dissociated as a general part-
47 ner is liable for the obligation, to the general partner or other person
48 for any damage caused to the general partner or other person arising from
49 the liability.
50 53-2-806. KNOWN CLAIMS AGAINST DISSOLVED LIMITED PARTNERSHIP. (1) A dis-
51 solved limited partnership may dispose of the known claims against it by fol-
52 lowing the procedure described in subsection (2) of this section.
32
1 (2) A dissolved limited partnership may notify its known claimants of the
2 dissolution in a record. The notice must:
3 (a) Specify the information required to be included in a claim;
4 (b) Provide a mailing address to which the claim is to be sent;
5 (c) State the deadline for receipt of the claim, which may not be less
6 than one hundred twenty (120) days after the date the notice is received
7 by the claimant;
8 (d) State that the claim will be barred if not received by the deadline;
9 and
10 (e) Unless the limited partnership has been throughout its existence a
11 limited liability limited partnership, state that the barring of a claim
12 against the limited partnership will also bar any corresponding claim
13 against any general partner or person dissociated as a general partner
14 which is based on section 53-2-404, Idaho Code.
15 (3) A claim against a dissolved limited partnership is barred if the
16 requirements of subsection (2) of this section are met and:
17 (a) The claim is not received by the specified deadline; or
18 (b) In the case of a claim that is timely received but rejected by the
19 dissolved limited partnership, the claimant does not commence an action to
20 enforce the claim against the limited partnership within ninety (90) days
21 after the receipt of the notice of the rejection.
22 (4) This section does not apply to a claim based on an event occurring
23 after the effective date of dissolution or a liability that is contingent on
24 that date.
25 53-2-807. OTHER CLAIMS AGAINST DISSOLVED LIMITED PARTNERSHIP. (1) A dis-
26 solved limited partnership may publish notice of its dissolution and request
27 persons having claims against the limited partnership to present them in
28 accordance with the notice.
29 (2) The notice must:
30 (a) Be published at least once in a newspaper of general circulation in
31 the county in which the dissolved limited partnership's principal office
32 is located or, if it has none in this state, in the county in which the
33 limited partnership's designated office is or was last located;
34 (b) Describe the information required to be contained in a claim and pro-
35 vide a mailing address to which the claim is to be sent;
36 (c) State that a claim against the limited partnership is barred unless
37 an action to enforce the claim is commenced within five (5) years after
38 publication of the notice; and
39 (d) Unless the limited partnership has been throughout its existence a
40 limited liability limited partnership, state that the barring of a claim
41 against the limited partnership will also bar any corresponding claim
42 against any general partner or person dissociated as a general partner
43 which is based on section 53-2-404, Idaho Code.
44 (3) If a dissolved limited partnership publishes a notice in accordance
45 with subsection (2) of this section, the claim of each of the following claim-
46 ants is barred unless the claimant commences an action to enforce the claim
47 against the dissolved limited partnership within five (5) years after the
48 publication date of the notice:
49 (a) A claimant that did not receive notice in a record under section
50 53-2-806, Idaho Code;
51 (b) A claimant whose claim was timely sent to the dissolved limited part-
52 nership but not acted on; and
53 (c) A claimant whose claim is contingent or based on an event occurring
54 after the effective date of dissolution.
33
1 (4) A claim not barred under this section may be enforced:
2 (a) Against the dissolved limited partnership, to the extent of its
3 undistributed assets;
4 (b) If the assets have been distributed in liquidation, against a partner
5 or transferee to the extent of that person's proportionate share of the
6 claim or the limited partnership's assets distributed to the partner or
7 transferee in liquidation, whichever is less, but a person's total liabil-
8 ity for all claims under this paragraph does not exceed the total amount
9 of assets distributed to the person as part of the winding up of the dis-
10 solved limited partnership; or
11 (c) Against any person liable on the claim under section 53-2-404, Idaho
12 Code.
13 53-2-808. LIABILITY OF GENERAL PARTNER AND PERSON DISSOCIATED AS GENERAL
14 PARTNER WHEN CLAIM AGAINST LIMITED PARTNERSHIP BARRED. If a claim against a
15 dissolved limited partnership is barred under section 53-2-806 or 53-2-807,
16 Idaho Code, any corresponding claim under section 53-2-404, Idaho Code, is
17 also barred.
18 53-2-809. ADMINISTRATIVE DISSOLUTION. (1) The secretary of state may dis-
19 solve a limited partnership administratively if the limited partnership does
20 not, within sixty (60) days after the due date:
21 (a) Pay any fee, tax, or penalty due to the secretary of state under this
22 chapter or other law; or
23 (b) Deliver its annual report to the secretary of state.
24 (2) If the secretary of state determines that a ground exists for admin-
25 istratively dissolving a limited partnership, the secretary of state shall
26 file a record of the determination and serve the limited partnership with a
27 copy of the filed record.
28 (3) If within sixty (60) days after service of the copy the limited part-
29 nership does not correct each ground for dissolution or demonstrate to the
30 reasonable satisfaction of the secretary of state that each ground determined
31 by the secretary of state does not exist, the secretary of state shall admin-
32 istratively dissolve the limited partnership by preparing, signing and filing
33 a declaration of dissolution that states the grounds for dissolution. The sec-
34 retary of state shall serve the limited partnership with a copy of the filed
35 declaration.
36 (4) A limited partnership administratively dissolved continues its exis-
37 tence but may carry on only activities necessary to wind up its activities and
38 liquidate its assets under sections 53-2-803 and 53-2-812, Idaho Code, and to
39 notify claimants under sections 53-2-806 and 53-2-807, Idaho Code.
40 (5) The administrative dissolution of a limited partnership does not ter-
41 minate the authority of its agent for service of process.
42 53-2-810. REINSTATEMENT FOLLOWING ADMINISTRATIVE DISSOLUTION. (1) A lim-
43 ited partnership that has been administratively dissolved may apply to the
44 secretary of state for reinstatement within two (2) years after the effective
45 date of dissolution. The application must be delivered to the secretary of
46 state for filing and state:
47 (a) The name of the limited partnership and the effective date of its
48 administrative dissolution;
49 (b) That the grounds for dissolution either did not exist or have been
50 eliminated; and
51 (c) That the limited partnership's name satisfies the requirements of
52 section 53-2-108, Idaho Code.
34
1 (2) If the secretary of state determines that an application contains the
2 information required by subsection (1) of this section and that the informa-
3 tion is correct, the secretary of state shall prepare a declaration of rein-
4 statement that states this determination, sign, and file the original of the
5 declaration of reinstatement, and serve the limited partnership with a copy.
6 (3) When reinstatement becomes effective, it relates back to and takes
7 effect as of the effective date of the administrative dissolution and the lim-
8 ited partnership may resume its activities as if the administrative dissolu-
9 tion had never occurred.
10 53-2-811. APPEAL FROM DENIAL OF REINSTATEMENT. (1) If the secretary of
11 state denies a limited partnership's application for reinstatement following
12 administrative dissolution, the secretary of state shall prepare, sign and
13 file a notice that explains the reason or reasons for denial and serve the
14 limited partnership with a copy of the notice.
15 (2) Within thirty (30) days after service of the notice of denial, the
16 limited partnership may appeal from the denial of reinstatement by petitioning
17 the court to set aside the dissolution. The petition must be served on the
18 secretary of state and contain a copy of the secretary of state's declaration
19 of dissolution, the limited partnership's application for reinstatement, and
20 the secretary of state's notice of denial.
21 (3) The court may summarily order the secretary of state to reinstate the
22 dissolved limited partnership or may take other action the court considers
23 appropriate.
24 53-2-812. DISPOSITION OF ASSETS -- WHEN CONTRIBUTIONS REQUIRED. (1) In
25 winding up a limited partnership's activities, the assets of the limited part-
26 nership, including the contributions required by this section, must be applied
27 to satisfy the limited partnership's obligations to creditors, including, to
28 the extent permitted by law, partners that are creditors.
29 (2) Any surplus remaining after the limited partnership complies with
30 subsection (1) of this section must be paid in cash as a distribution.
31 (3) If a limited partnership's assets are insufficient to satisfy all of
32 its obligations under subsection (1) of this section, with respect to each
33 unsatisfied obligation incurred when the limited partnership was not a limited
34 liability limited partnership, the following rules apply:
35 (a) Each person that was a general partner when the obligation was incur-
36 red and that has not been released from the obligation under section
37 53-2-607, Idaho Code, shall contribute to the limited partnership for the
38 purpose of enabling the limited partnership to satisfy the obligation. The
39 contribution due from each of those persons is in proportion to the right
40 to receive distributions in the capacity of general partner in effect for
41 each of those persons when the obligation was incurred.
42 (b) If a person does not contribute the full amount required under para-
43 graph (a) of this subsection with respect to an unsatisfied obligation of
44 the limited partnership, the other persons required to contribute by para-
45 graph (a) of this subsection on account of the obligation shall contribute
46 the additional amount necessary to discharge the obligation. The addi-
47 tional contribution due from each of those other persons is in proportion
48 to the right to receive distributions in the capacity of general partner
49 in effect for each of those other persons when the obligation was incur-
50 red.
51 (c) If a person does not make the additional contribution required by
52 paragraph (b) of this subsection, further additional contributions are
53 determined and due in the same manner as provided in that paragraph.
35
1 (4) A person that makes an additional contribution under subsection
2 (3)(b) or (c) of this section may recover from any person whose failure to
3 contribute under subsection (3)(a) or (b) of this section necessitated the
4 additional contribution. A person may not recover under this subsection more
5 than the amount additionally contributed. A person's liability under this sub-
6 section may not exceed the amount the person failed to contribute.
7 (5) The estate of a deceased individual is liable for the person's obli-
8 gations under this section.
9 (6) An assignee for the benefit of creditors of a limited partnership or
10 a partner, or a person appointed by a court to represent creditors of a lim-
11 ited partnership or a partner, may enforce a person's obligation to contribute
12 under subsection (3) of this section.
13 PART 9
14 FOREIGN LIMITED PARTNERSHIPS
15 53-2-901. GOVERNING LAW. (1) The laws of the state or other jurisdiction
16 under which a foreign limited partnership is organized govern relations among
17 the partners of the foreign limited partnership and between the partners and
18 the foreign limited partnership and the liability of partners as partners for
19 an obligation of the foreign limited partnership.
20 (2) A foreign limited partnership may not be denied a certificate of
21 authority by reason of any difference between the laws of the jurisdiction
22 under which the foreign limited partnership is organized and the laws of this
23 state.
24 (3) A certificate of authority does not authorize a foreign limited part-
25 nership to engage in any business or exercise any power that a limited part-
26 nership may not engage in or exercise in this state.
27 53-2-902. APPLICATION FOR CERTIFICATE OF AUTHORITY. (1) A foreign limited
28 partnership may apply for a certificate of authority to transact business in
29 this state by delivering an application to the secretary of state for filing.
30 The application must state:
31 (a) The name of the foreign limited partnership and, if the name does not
32 comply with section 53-2-108, Idaho Code, an alternate name adopted pursu-
33 ant to section 53-2-905(1), Idaho Code;
34 (b) The name of the state or other jurisdiction under whose law the for-
35 eign limited partnership is organized;
36 (c) The street and mailing address of the foreign limited partnership's
37 principal office and, if the laws of the jurisdiction under which the for-
38 eign limited partnership is organized require the foreign limited part-
39 nership to maintain an office in that jurisdiction, the street and mailing
40 address of the required office;
41 (d) The name and street and mailing address of the foreign limited
42 partnership's initial agent for service of process in this state;
43 (e) The name and street and mailing address of each of the foreign lim-
44 ited partnership's general partners; and
45 (f) Whether the foreign limited partnership is a foreign limited liabil-
46 ity limited partnership.
47 (2) A foreign limited partnership shall deliver with the completed appli-
48 cation a certificate of existence or a record of similar import signed by the
49 secretary of state or other official having custody of the foreign limited
50 partnership's publicly filed records in the state or other jurisdiction under
51 whose law the foreign limited partnership is organized.
36
1 53-2-903. ACTIVITIES NOT CONSTITUTING TRANSACTING BUSINESS. (1) Activi-
2 ties of a foreign limited partnership which do not constitute transacting
3 business in this state within the meaning of this part 9 include:
4 (a) Maintaining, defending, and settling an action or proceeding;
5 (b) Holding meetings of its partners or carrying on any other activity
6 concerning its internal affairs;
7 (c) Maintaining accounts in financial institutions;
8 (d) Maintaining offices or agencies for the transfer, exchange, and reg-
9 istration of the foreign limited partnership's own securities or maintain-
10 ing trustees or depositories with respect to those securities;
11 (e) Selling through independent contractors;
12 (f) Soliciting or obtaining orders, whether by mail or electronic means
13 or through employees or agents or otherwise, if the orders require accep-
14 tance outside this state before they become contracts;
15 (g) Creating or acquiring indebtedness, mortgages, or security interests
16 in real or personal property;
17 (h) Securing or collecting debts or enforcing mortgages or other security
18 interests in property securing the debts, and holding, protecting, and
19 maintaining property so acquired;
20 (i) Conducting an isolated transaction that is completed within thirty
21 (30) days and is not one in the course of similar transactions of a like
22 manner; and
23 (j) Transacting business in interstate commerce.
24 (2) For purposes of this part 9, the ownership in this state of income-
25 producing real property or tangible personal property, other than property
26 excluded under subsection (1) of this section, constitutes transacting busi-
27 ness in this state.
28 (3) This section does not apply in determining the contacts or activities
29 that may subject a foreign limited partnership to service of process, taxa-
30 tion, or regulation under any other law of this state.
31 53-2-904. FILING OF CERTIFICATE OF AUTHORITY. Unless the secretary of
32 state determines that an application for a certificate of authority does not
33 comply with the filing requirements of this chapter, the secretary of state,
34 upon payment of all filing fees, shall file the application, prepare, sign
35 and file a certificate of authority to transact business in this state, and
36 send a copy of the filed certificate, together with a receipt for the fees, to
37 the foreign limited partnership or its representative.
38 53-2-905. NONCOMPLYING NAME OF FOREIGN LIMITED PARTNERSHIP. (1) A foreign
39 limited partnership whose name does not comply with section 53-2-108, Idaho
40 Code, may not obtain a certificate of authority until it adopts, for the pur-
41 pose of transacting business in this state, an alternate name that complies
42 with section 53-2-108, Idaho Code. After obtaining a certificate of authority
43 with an alternate name, a foreign limited partnership shall transact business
44 in this state under the name.
45 (2) If a foreign limited partnership authorized to transact business in
46 this state changes its name to one that does not comply with section 53-2-108,
47 Idaho Code, it may not thereafter transact business in this state until it
48 complies with subsection (1) of this section and obtains an amended certifi-
49 cate of authority.
50 53-2-906. REVOCATION OF CERTIFICATE OF AUTHORITY. (1) A certificate of
51 authority of a foreign limited partnership to transact business in this state
52 may be revoked by the secretary of state in the manner provided in subsections
37
1 (2) and (3) of this section if the foreign limited partnership does not:
2 (a) Pay, within sixty (60) days after the due date, any fee, tax or pen-
3 alty due to the secretary of state under this chapter or other law;
4 (b) Deliver, within sixty (60) days after the due date, its annual report
5 required under section 53-2-210, Idaho Code;
6 (c) Appoint and maintain an agent for service of process as required by
7 section 53-2-114(2), Idaho Code; or
8 (d) Deliver for filing a statement of a change under section 53-2-115,
9 Idaho Code, within thirty (30) days after a change has occurred in the
10 name or address of the agent.
11 (2) In order to revoke a certificate of authority, the secretary of state
12 must prepare, sign, and file a notice of revocation and send a copy to the
13 foreign limited partnership's agent for service of process in this state, or
14 if the foreign limited partnership does not appoint and maintain a proper
15 agent in this state, to the foreign limited partnership's designated office.
16 The notice must state:
17 (a) The revocation's effective date, which must be at least sixty (60)
18 days after the date the secretary of state sends the copy; and
19 (b) The foreign limited partnership's failures to comply with subsection
20 (1) of this section which are the reason for the revocation.
21 (3) The authority of the foreign limited partnership to transact business
22 in this state ceases on the effective date of the notice of revocation unless
23 before that date the foreign limited partnership cures each failure to comply
24 with subsection (1) of this section stated in the notice. If the foreign lim-
25 ited partnership cures the failures, the secretary of state shall so indicate
26 on the filed notice.
27 53-2-907. CANCELLATION OF CERTIFICATE OF AUTHORITY -- EFFECT OF FAILURE
28 TO HAVE CERTIFICATE. (1) In order to cancel its certificate of authority to
29 transact business in this state, a foreign limited partnership must deliver to
30 the secretary of state for filing a notice of cancellation. The certificate
31 is canceled when the notice becomes effective under section 53-2-206, Idaho
32 Code.
33 (2) A foreign limited partnership transacting business in this state may
34 not maintain an action or proceeding in this state unless it has a certificate
35 of authority to transact business in this state.
36 (3) The failure of a foreign limited partnership to have a certificate of
37 authority to transact business in this state does not impair the validity of a
38 contract or act of the foreign limited partnership or prevent the foreign lim-
39 ited partnership from defending an action or proceeding in this state.
40 (4) A partner of a foreign limited partnership is not liable for the
41 obligations of the foreign limited partnership solely by reason of the foreign
42 limited partnership's having transacted business in this state without a cer-
43 tificate of authority.
44 (5) If a foreign limited partnership transacts business in this state
45 without a certificate of authority or cancels its certificate of authority, it
46 appoints the secretary of state as its agent for service of process for rights
47 of action arising out of the transaction of business in this state.
48 53-2-908. ACTION BY ATTORNEY GENERAL. The attorney general may maintain
49 an action to restrain a foreign limited partnership from transacting business
50 in this state in violation of this part 9.
38
1 PART 10
2 ACTIONS BY PARTNERS
3 53-2-1001. DIRECT ACTION BY PARTNER. (1) Subject to subsection (2) of
4 this section, a partner may maintain a direct action against the limited part-
5 nership or another partner for legal or equitable relief, with or without an
6 accounting as to the partnership's activities, to enforce the rights and
7 otherwise protect the interests of the partner, including rights and interests
8 under the partnership agreement or this chapter or arising independently of
9 the partnership relationship.
10 (2) A partner commencing a direct action under this section is required
11 to plead and prove an actual or threatened injury that is not solely the
12 result of an injury suffered or threatened to be suffered by the limited part-
13 nership.
14 (3) The accrual of, and any time limitation on, a right of action for a
15 remedy under this section is governed by other law. A right to an accounting
16 upon a dissolution and winding up does not revive a claim barred by law.
17 53-2-1002. DERIVATIVE ACTION. A partner may maintain a derivative action
18 to enforce a right of a limited partnership if:
19 (1) The partner first makes a demand on the general partners, requesting
20 that they cause the limited partnership to bring an action to enforce the
21 right, and the general partners do not bring the action within a reasonable
22 time; or
23 (2) A demand would be futile.
24 53-2-1003. PROPER PLAINTIFF. A derivative action may be maintained only
25 by a person that is a partner at the time the action is commenced and:
26 (1) That was a partner when the conduct giving rise to the action
27 occurred; or
28 (2) Whose status as a partner devolved upon the person by operation of
29 law or pursuant to the terms of the partnership agreement from a person that
30 was a partner at the time of the conduct.
31 53-2-1004. PLEADING. In a derivative action, the complaint must state
32 with particularity:
33 (1) The date and content of plaintiff's demand and the general partners'
34 response to the demand; or
35 (2) Why demand should be excused as futile.
36 53-2-1005. PROCEEDS AND EXPENSES. (1) Except as otherwise provided in
37 subsection (2) of this section:
38 (a) Any proceeds or other benefits of a derivative action, whether by
39 judgment, compromise, or settlement, belong to the limited partnership and
40 not to the derivative plaintiff;
41 (b) If the derivative plaintiff receives any proceeds, the derivative
42 plaintiff shall immediately remit them to the limited partnership.
43 (2) If a derivative action is successful in whole or in part, the court
44 may award the plaintiff reasonable expenses, including reasonable attorney's
45 fees, from the recovery of the limited partnership.
46 PART 11
47 CONVERSION AND MERGER
48 53-2-1101. DEFINITIONS. In this part 11:
39
1 (1) "Constituent limited partnership" means a constituent organization
2 that is a limited partnership.
3 (2) "Constituent organization" means an organization that is party to a
4 merger.
5 (3) "Converted organization" means the organization into which a convert-
6 ing organization converts pursuant to sections 53-2-1102 through 53-2-1105,
7 Idaho Code.
8 (4) "Converting limited partnership" means a converting organization that
9 is a limited partnership.
10 (5) "Converting organization" means an organization that converts into
11 another organization pursuant to section 53-2-1102, Idaho Code.
12 (6) "General partner" means a general partner of a limited partnership.
13 (7) "Governing statute" of an organization means the statute that governs
14 the organization's internal affairs.
15 (8) "Organization" means a general partnership, including a limited lia-
16 bility partnership; limited partnership, including a limited liability limited
17 partnership; limited liability company; business trust; corporation; or any
18 other person having a governing statute. The term includes domestic and for-
19 eign organizations whether or not organized for profit.
20 (9) "Organizational documents" means:
21 (a) For a domestic or foreign general partnership, its partnership agree-
22 ment;
23 (b) For a limited partnership or foreign limited partnership, its certif-
24 icate of limited partnership and partnership agreement;
25 (c) For a domestic or foreign limited liability company, its articles of
26 organization and operating agreement, or comparable records as provided in
27 its governing statute;
28 (d) For a business trust, its agreement of trust and declaration of
29 trust;
30 (e) For a domestic or foreign corporation for profit, its articles of
31 incorporation, bylaws, and other agreements among its shareholders which
32 are authorized by its governing statute, or comparable records as provided
33 in its governing statute; and
34 (f) For any other organization, the basic records that create the organi-
35 zation and determine its internal governance and the relations among the
36 persons that own it, have an interest in it, or are members of it.
37 (10) "Personal liability" means personal liability for a debt, liability,
38 or other obligation of an organization which is imposed on a person that co-
39 owns, has an interest in, or is a member of the organization:
40 (a) By the organization's governing statute solely by reason of the per-
41 son co-owning, having an interest in, or being a member of the organiza-
42 tion; or
43 (b) By the organization's organizational documents under a provision of
44 the organization's governing statute authorizing those documents to make
45 one (1) or more specified persons liable for all or specified debts, lia-
46 bilities, and other obligations of the organization solely by reason of
47 the person or persons co-owning, having an interest in, or being a member
48 of the organization.
49 (11) "Surviving organization" means an organization into which one (1) or
50 more other organizations are merged. A surviving organization may preexist the
51 merger or be created by the merger.
52 53-2-1102. CONVERSION. (1) An organization other than a limited partner-
53 ship may convert to a limited partnership, and a limited partnership may con-
54 vert to another organization pursuant to this section and sections 53-2-1103
40
1 through 53-2-1105, Idaho Code, and a plan of conversion, if:
2 (a) The other organization's governing statute authorizes the conversion;
3 (b) The conversion is not prohibited by the law of the jurisdiction that
4 enacted the governing statute; and
5 (c) The other organization complies with its governing statute in effect-
6 ing the conversion.
7 (2) A plan of conversion must be in a record and must include:
8 (a) The name and form of the organization before conversion;
9 (b) The name and form of the organization after conversion; and
10 (c) The terms and conditions of the conversion, including the manner and
11 basis for converting interests in the converting organization into any
12 combination of money, interests in the converted organization, and other
13 consideration; and
14 (d) The organizational documents of the converted organization.
15 53-2-1103. ACTION ON PLAN OF CONVERSION BY CONVERTING LIMITED PARTNER-
16 SHIP. (1) Subject to section 53-2-1110, Idaho Code, a plan of conversion must
17 be consented to by all the partners of a converting limited partnership.
18 (2) Subject to section 53-2-1110, Idaho Code, and any contractual rights,
19 after a conversion is approved, and at any time before a filing is made under
20 section 53-2-1104, Idaho Code, a converting limited partnership may amend the
21 plan or abandon the planned conversion:
22 (a) As provided in the plan; and
23 (b) Except as prohibited by the plan, by the same consent as was required
24 to approve the plan.
25 53-2-1104. FILINGS REQUIRED FOR CONVERSION -- EFFECTIVE DATE. (1) After a
26 plan of conversion is approved:
27 (a) A converting limited partnership shall deliver to the secretary of
28 state for filing articles of conversion, which must include:
29 (i) A statement that the limited partnership has been converted
30 into another organization;
31 (ii) The name and form of the organization and the jurisdiction of
32 its governing statute;
33 (iii) The date the conversion is effective under the governing stat-
34 ute of the converted organization;
35 (iv) A statement that the conversion was approved as required by
36 this chapter;
37 (v) A statement that the conversion was approved as required by the
38 governing statute of the converted organization; and
39 (vi) If the converted organization is a foreign organization not
40 authorized to transact business in this state, the street and mailing
41 address of an office which the secretary of state may use for the
42 purposes of section 53-2-1105(3), Idaho Code; and
43 (b) If the converting organization is not a converting limited partner-
44 ship, the converting organization shall deliver to the secretary of state
45 for filing a certificate of limited partnership, which must include, in
46 addition to the information required by section 53-2-201, Idaho Code:
47 (i) A statement that the limited partnership was converted from
48 another organization;
49 (ii) The name and form of the organization and the jurisdiction of
50 its governing statute; and
51 (iii) A statement that the conversion was approved in a manner that
52 complied with the organization's governing statute.
53 (2) A conversion becomes effective:
41
1 (a) If the converted organization is a limited partnership, when the cer-
2 tificate of limited partnership takes effect; and
3 (b) If the converted organization is not a limited partnership, as pro-
4 vided by the governing statute of the converted organization.
5 53-2-1105. EFFECT OF CONVERSION. (1) An organization that has been con-
6 verted pursuant to this part 11 is for all purposes the same entity that
7 existed before the conversion.
8 (2) When a conversion takes effect:
9 (a) All property owned by the converting organization remains vested in
10 the converted organization;
11 (b) All debts, liabilities, and other obligations of the converting orga-
12 nization continue as obligations of the converted organization;
13 (c) An action or proceeding pending by or against the converting organi-
14 zation may be continued as if the conversion had not occurred;
15 (d) Except as prohibited by other law, all of the rights, privileges,
16 immunities, powers, and purposes of the converting organization remain
17 vested in the converted organization;
18 (e) Except as otherwise provided in the plan of conversion, the terms and
19 conditions of the plan of conversion take effect; and
20 (f) Except as otherwise agreed, the conversion does not dissolve a con-
21 verting limited partnership for the purposes of part 8 of this chapter.
22 (3) A converted organization that is a foreign organization consents to
23 the jurisdiction of the courts of this state to enforce any obligation owed by
24 the converting limited partnership, if before the conversion the converting
25 limited partnership was subject to suit in this state on the obligation. A
26 converted organization that is a foreign organization and not authorized to
27 transact business in this state appoints the secretary of state as its agent
28 for service of process for purposes of enforcing an obligation under this sub-
29 section. Service on the secretary of state under this subsection (3) is made
30 in the same manner and with the same consequences as in section 53-2-117(3)
31 and (4), Idaho Code.
32 53-2-1106. MERGER. (1) A limited partnership may merge with one (1) or
33 more other constituent organizations pursuant to this section and sections
34 53-2-1107 through 53-2-1109, Idaho Code, and a plan of merger, if:
35 (a) The governing statute of each of the other organizations authorizes
36 the merger;
37 (b) The merger is not prohibited by the law of a jurisdiction that
38 enacted any of those governing statutes; and
39 (c) Each of the other organizations complies with its governing statute
40 in effecting the merger.
41 (2) A plan of merger must be in a record and must include:
42 (a) The name and form of each constituent organization;
43 (b) The name and form of the surviving organization and, if the surviving
44 organization is to be created by the merger, a statement to that effect;
45 (c) The terms and conditions of the merger, including the manner and
46 basis for converting the interests in each constituent organization into
47 any combination of money, interests in the surviving organization, and
48 other consideration;
49 (d) If the surviving organization is to be created by the merger, the
50 surviving organization's organizational documents; and
51 (e) If the surviving organization is not to be created by the merger, any
52 amendments to be made by the merger to the surviving organization's orga-
53 nizational documents.
42
1 53-2-1107. ACTION ON PLAN OF MERGER BY CONSTITUENT LIMITED PARTNERSHIP.
2 (1) Subject to section 53-2-1110, Idaho Code, a plan of merger must be con-
3 sented to by all the partners of a constituent limited partnership.
4 (2) Subject to section 53-2-1110, Idaho Code, and any contractual rights,
5 after a merger is approved, and at any time before a filing is made under sec-
6 tion 53-2-1108, Idaho Code, a constituent limited partnership may amend the
7 plan or abandon the planned merger:
8 (a) As provided in the plan; and
9 (b) Except as prohibited by the plan, with the same consent as was
10 required to approve the plan.
11 53-2-1108. FILINGS REQUIRED FOR MERGER -- EFFECTIVE DATE. (1) After each
12 constituent organization has approved a merger, articles of merger must be
13 signed on behalf of:
14 (a) Each preexisting constituent limited partnership, by each general
15 partner listed in the certificate of limited partnership; and
16 (b) Each other preexisting constituent organization, by an authorized
17 representative.
18 (2) The articles of merger must include:
19 (a) The name and form of each constituent organization and the jurisdic-
20 tion of its governing statute;
21 (b) The name and form of the surviving organization, the jurisdiction of
22 its governing statute, and, if the surviving organization is created by
23 the merger, a statement to that effect;
24 (c) The date the merger is effective under the governing statute of the
25 surviving organization;
26 (d) If the surviving organization is to be created by the merger:
27 (i) If it will be a limited partnership, the limited partnership's
28 certificate of limited partnership; or
29 (ii) If it will be an organization other than a limited partnership,
30 the organizational document that creates the organization;
31 (e) If the surviving organization preexists the merger, any amendments
32 provided for in the plan of merger for the organizational document that
33 created the organization;
34 (f) A statement as to each constituent organization that the merger was
35 approved as required by the organization's governing statute;
36 (g) If the surviving organization is a foreign organization not autho-
37 rized to transact business in this state, the street and mailing address
38 of an office which the secretary of state may use for the purposes of sec-
39 tion 53-2-1109(2), Idaho Code; and
40 (h) Any additional information required by the governing statute of any
41 constituent organization.
42 (3) Each constituent limited partnership shall deliver the articles of
43 merger for filing in the office of the secretary of state.
44 (4) A merger becomes effective under this part 11:
45 (a) If the surviving organization is a limited partnership, upon the
46 later of:
47 (i) Compliance with subsection (3) of this section; or
48 (ii) Subject to section 53-2-206(3), Idaho Code, as specified in the
49 articles of merger; or
50 (b) If the surviving organization is not a limited partnership, as pro-
51 vided by the governing statute of the surviving organization.
52 53-2-1109. EFFECT OF MERGER. (1) When a merger becomes effective:
53 (a) The surviving organization continues or comes into existence;
43
1 (b) Each constituent organization that merges into the surviving organi-
2 zation ceases to exist as a separate entity;
3 (c) All property owned by each constituent organization that ceases to
4 exist vests in the surviving organization;
5 (d) All debts, liabilities, and other obligations of each constituent
6 organization that ceases to exist continue as obligations of the surviving
7 organization;
8 (e) An action or proceeding pending by or against any constituent organi-
9 zation that ceases to exist may be continued as if the merger had not
10 occurred;
11 (f) Except as prohibited by other law, all of the rights, privileges,
12 immunities, powers, and purposes of each constituent organization that
13 ceases to exist vest in the surviving organization;
14 (g) Except as otherwise provided in the plan of merger, the terms and
15 conditions of the plan of merger take effect; and
16 (h) Except as otherwise agreed, if a constituent limited partnership
17 ceases to exist, the merger does not dissolve the limited partnership for
18 the purposes of part 8 of this chapter;
19 (i) If the surviving organization is created by the merger:
20 (i) If it is a limited partnership, the certificate of limited
21 partnership becomes effective; or
22 (ii) If it is an organization other than a limited partnership, the
23 organizational document that creates the organization becomes effec-
24 tive; and
25 (j) If the surviving organization preexists the merger, any amendments
26 provided for in the articles of merger for the organizational document
27 that created the organization become effective.
28 (2) A surviving organization that is a foreign organization consents to
29 the jurisdiction of the courts of this state to enforce any obligation owed by
30 a constituent organization, if before the merger the constituent organization
31 was subject to suit in this state on the obligation. A surviving organization
32 that is a foreign organization and not authorized to transact business in this
33 state appoints the secretary of state as its agent for service of process for
34 the purposes of enforcing an obligation under this subsection. Service on the
35 secretary of state under this subsection is made in the same manner and with
36 the same consequences as in section 53-2-117(3) and (4).
37 53-2-1110. RESTRICTIONS ON APPROVAL OF CONVERSIONS AND MERGERS AND ON
38 RELINQUISHING LLLP STATUS. (1) If a partner of a converting or constituent
39 limited partnership will have personal liability with respect to a converted
40 or surviving organization, approval and amendment of a plan of conversion or
41 merger are ineffective without the consent of the partner, unless:
42 (a) The limited partnership's partnership agreement provides for the
43 approval of the conversion or merger with the consent of fewer than all
44 the partners; and
45 (b) The partner has consented to the provision of the partnership agree-
46 ment.
47 (2) An amendment to a certificate of limited partnership which deletes a
48 statement that the limited partnership is a limited liability limited partner-
49 ship is ineffective without the consent of each general partner unless:
50 (a) The limited partnership's partnership agreement provides for the
51 amendment with the consent of less than all the general partners; and
52 (b) Each general partner that does not consent to the amendment has con-
53 sented to the provision of the partnership agreement.
54 (3) A partner does not give the consent required by subsection (1) or (2)
44
1 of this section merely by consenting to a provision of the partnership agree-
2 ment which permits the partnership agreement to be amended with the consent of
3 fewer than all the partners.
4 53-2-1111. LIABILITY OF GENERAL PARTNER AFTER CONVERSION OR MERGER. (1) A
5 conversion or merger under this part 11 does not discharge any liability under
6 sections 53-2-404 and 53-2-607, Idaho Code, of a person that was a general
7 partner in or dissociated as a general partner from a converting or constitu-
8 ent limited partnership, but:
9 (a) The provisions of this chapter pertaining to the collection or dis-
10 charge of the liability continue to apply to the liability;
11 (b) For the purposes of applying those provisions, the converted or sur-
12 viving organization is deemed to be the converting or constituent limited
13 partnership; and
14 (c) If a person is required to pay any amount under this subsection:
15 (i) The person has a right of contribution from each other person
16 that was liable as a general partner under section 53-2-404, Idaho
17 Code, when the obligation was incurred and has not been released from
18 the obligation under section 53-2-607, Idaho Code; and
19 (ii) The contribution due from each of those persons is in propor-
20 tion to the right to receive distributions in the capacity of general
21 partner in effect for each of those persons when the obligation was
22 incurred.
23 (2) In addition to any other liability provided by law:
24 (a) A person that immediately before a conversion or merger became effec-
25 tive was a general partner in a converting or constituent limited partner-
26 ship that was not a limited liability limited partnership is personally
27 liable for each obligation of the converted or surviving organization
28 arising from a transaction with a third party after the conversion or
29 merger becomes effective, if, at the time the third party enters into the
30 transaction, the third party:
31 (i) Does not have notice of the conversion or merger; and
32 (ii) Reasonably believes that:
33 (A) The converted or surviving business is the converting or
34 constituent limited partnership;
35 (B) The converting or constituent limited partnership is not a
36 limited liability limited partnership; and
37 (C) The person is a general partner in the converting or con-
38 stituent limited partnership; and
39 (b) A person that was dissociated as a general partner from a converting
40 or constituent limited partnership before the conversion or merger became
41 effective is personally liable for each obligation of the converted or
42 surviving organization arising from a transaction with a third party after
43 the conversion or merger becomes effective, if:
44 (i) Immediately before the conversion or merger became effective
45 the converting or surviving limited partnership was not a limited
46 liability limited partnership; and
47 (ii) At the time the third party enters into the transaction less
48 than two (2) years have passed since the person dissociated as a gen-
49 eral partner and the third party:
50 (A) Does not have notice of the dissociation;
51 (B) Does not have notice of the conversion or merger; and
52 (C) Reasonably believes that the converted or surviving organi-
53 zation is the converting or constituent limited partnership, the
54 converting or constituent limited partnership is not a limited
45
1 liability limited partnership, and the person is a general part-
2 ner in the converting or constituent limited partnership.
3 53-2-1112. POWER OF GENERAL PARTNERS AND PERSONS DISSOCIATED AS GENERAL
4 PARTNERS TO BIND ORGANIZATION AFTER CONVERSION OR MERGER. (1) An act of a per-
5 son that immediately before a conversion or merger became effective was a gen-
6 eral partner in a converting or constituent limited partnership binds the con-
7 verted or surviving organization after the conversion or merger becomes effec-
8 tive, if:
9 (a) Before the conversion or merger became effective, the act would have
10 bound the converting or constituent limited partnership under section
11 53-2-402, Idaho Code; and
12 (b) At the time the third party enters into the transaction, the third
13 party:
14 (i) Does not have notice of the conversion or merger; and
15 (ii) Reasonably believes that the converted or surviving business is
16 the converting or constituent limited partnership and that the person
17 is a general partner in the converting or constituent limited part-
18 nership.
19 (2) An act of a person that before a conversion or merger became effec-
20 tive was dissociated as a general partner from a converting or constituent
21 limited partnership binds the converted or surviving organization after the
22 conversion or merger becomes effective, if:
23 (a) Before the conversion or merger became effective, the act would have
24 bound the converting or constituent limited partnership under section
25 53-2-402, Idaho Code, if the person had been a general partner; and
26 (b) At the time the third party enters into the transaction, less than
27 two (2) years have passed since the person dissociated as a general part-
28 ner and the third party:
29 (i) Does not have notice of the dissociation;
30 (ii) Does not have notice of the conversion or merger; and
31 (iii) Reasonably believes that the converted or surviving organiza-
32 tion is the converting or constituent limited partnership and that
33 the person is a general partner in the converting or constituent lim-
34 ited partnership.
35 (3) If a person having knowledge of the conversion or merger causes a
36 converted or surviving organization to incur an obligation under subsection
37 (1) or (2) of this section, the person is liable:
38 (a) To the converted or surviving organization for any damage caused to
39 the organization arising from the obligation; and
40 (b) If another person is liable for the obligation, to that other person
41 for any damage caused to that other person arising from the liability.
42 53-2-1113. PART NOT EXCLUSIVE. This part 11 does not preclude an entity
43 from being converted or merged under other law.
44 PART 12
45 MISCELLANEOUS PROVISIONS
46 53-2-1201. UNIFORMITY OF APPLICATION AND CONSTRUCTION. In applying and
47 construing this chapter, consideration must be given to the need to promote
48 uniformity of the law with respect to its subject matter among states that
49 enact it.
50 53-2-1202. SEVERABILITY CLAUSE. If any provision of this act or its
46
1 application to any person or circumstance is held invalid, the invalidity does
2 not affect other provisions or applications of this act which can be given
3 effect without the invalid provision or application, and to this end the pro-
4 visions of this act are severable.
5 53-2-1203. RELATION TO ELECTRONIC SIGNATURES IN GLOBAL AND NATIONAL COM-
6 MERCE ACT. This chapter modifies, limits, or supersedes the federal electronic
7 signatures in global and national commerce act, 15 U.S.C. section 7001 et
8 seq., but this chapter does not modify, limit, or supersede section 101(c) of
9 that act or authorize electronic delivery of any of the notices described in
10 section 103(b) of that act.
11 53-2-1204. APPLICATION TO EXISTING RELATIONSHIPS. (1) This chapter gov-
12 erns only:
13 (a) A limited partnership formed on or after July 1, 2005; and
14 (b) Except as otherwise provided in subsections (3) and (4) of this sec-
15 tion, a limited partnership formed before July 1, 2005, which elects, in
16 the manner provided in its partnership agreement or by law for amending
17 the partnership agreement, to be subject to this chapter.
18 (2) Except as otherwise provided in subsection (3) of this section, on
19 and after July 1, 2005, this chapter governs all limited partnerships.
20 (3) With respect to a limited partnership formed before July 1, 2005, the
21 following rules apply except as the partners otherwise elect in the manner
22 provided in the partnership agreement or by law for amending the partnership
23 agreement:
24 (a) Section 53-2-104(3), Idaho Code, does not apply and the limited part-
25 nership has whatever duration it had under the law applicable immediately
26 before July 1, 2005.
27 (b) The limited partnership is not required to amend its certificate of
28 limited partnership to comply with section 53-2-201(1)(d), Idaho Code.
29 (c) Sections 53-2-601 and 53-2-602, Idaho Code, do not apply and a lim-
30 ited partner has the same right and power to dissociate from the limited
31 partnership, with the same consequences, as existed immediately before
32 July 1, 2005.
33 (d) Section 53-2-603(4), Idaho Code, does not apply.
34 (e) Section 53-2-603(5), Idaho Code, does not apply and a court has the
35 same power to expel a general partner as the court had immediately before
36 July 1, 2005.
37 (f) Section 53-2-801(3), Idaho Code, does not apply and the connection
38 between a person's dissociation as a general partner and the dissolution
39 of the limited partnership is the same as existed immediately before July
40 1, 2005.
41 (4) With respect to a limited partnership that elects pursuant to subsec-
42 tion (1)(b) of this section to be subject to this chapter, after the election
43 takes effect the provisions of this chapter relating to the liability of the
44 limited partnership's general partners to third parties apply:
45 (a) Before July 1, 2005, to:
46 (i) A third party that had not done business with the limited part-
47 nership in the year before the election took effect; and
48 (ii) A third party that had done business with the limited partner-
49 ship in the year before the election took effect only if the third
50 party knows or has received a notification of the election; and
51 (b) On and after July 1, 2005, to all third parties, but those provisions
52 remain inapplicable to any obligation incurred while those provisions were
53 inapplicable under subsection (4)(a)(ii) of this section.
47
1 53-2-1205. SAVINGS CLAUSE. This act does not affect an action commenced,
2 proceeding brought, or right accrued before this act takes effect.
3 SECTION 3. This act shall be in full force and effect on and after July
4 1, 2005.
STATEMENT OF PURPOSE
RS 14535
This legislation proposes to repeal Idaho's current version of
The Uniform Limited Partnership Act. In its stead it provides
principally for the adoption of the National Conference of
Commissioners on Uniform State Law (NCCUSL) promulgation of the
Uniform Limited Partnership Act.
FISCAL IMPACT
None
Contact
Name: Bart Davis
Phone: 332-1305
STATEMENT OF PURPOSE/FISCAL NOTE S 1041