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Where There Is a Surviving Partner and No Agreement to the Contrary, the Representative of a Deceased Partner Cannot Participate in the Winding Up of the Partnership and Has No Legal Right to the Partnership’s Assets, Books, Records or Business

The Second Department noted that the power to wind up a partnership (here BDF) is held by the surviving partner (here 6D) and cannot be exercised by the representative of a deceased partner (here Mrs. Benedict):

Under Partnership Law § 68, “[u]nless otherwise agreed the partners who have not wrongfully dissolved the partnership or the legal representative of the last surviving partner, not bankrupt, has the right to wind up the partnership affairs; provided, however, that any partner, his [or her] legal representative, or his [or her] assignee, upon cause shown, may obtain winding up by the court.” Further, on the death of a partner, “his [or her] right in specific partnership property vests in the surviving partner or partners, except where the deceased was the last surviving partner, when his [or her] right in such property vests in his [or her] legal representative” (Partnership Law § 51[2][d]…). The representative of a deceased partner is not entitled to participate in or interfere with the continuation of or winding up of partnership business by the surviving partner … .

Based on this authority, the Supreme Court correctly determined that, upon Mrs. Benedict's death, 6D was the only entity with a legal right to wind up BDF's business affairs because 6D was the only surviving partner. Moreover, upon Mrs. Benedict's death, the estate had no legal right to BDF's assets, books, records, or business. Rather, all rights to such property vested immediately in 6D, which was the only entity authorized to wind up BDF's business.  Neilson v 6D Farm Corp, 2014 NY Slip Op 08409, 2nd Dept 12-3-14

 

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