Kentucky Statutes 362.2-509 – Liability for improper distributions
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(1) A general partner that consents to a distribution made in violation of KRS § 362.2-
508 is personally liable to the limited partnership for the amount of the distribution which exceeds the amount that could have been distributed without the violation if it is established that in consenting to the distribution the general partner failed to comply with KRS § 362.2-408.
(2) A partner or transferee that knew a distribution was made in violation of KRS
362.2-508 is personally liable to the limited partnership but only to the extent that the distribution received by the partner or transferee exceeded the amount that could have been properly paid under KRS § 362.2-508.
(3) A general partner against which an action is brought under subsection (1) of this section may:
(a) Implead in the action any other person that as a general partner consented to the distribution in violation of subsection (1) of this section and compel contribution from that person; and
(b) Implead in the action any person that received a distribution in violation of subsection (2) of this section and compel contribution from that person in the amount that person received in violation of subsection (2) of this section.
(4) A proceeding under this section is barred if it is not commenced within two (2)
years after the distribution.
Effective: July 12, 2006
History: Created 2006 Ky. Acts ch. 149, sec. 137, effective July 12, 2006.
508 is personally liable to the limited partnership for the amount of the distribution which exceeds the amount that could have been distributed without the violation if it is established that in consenting to the distribution the general partner failed to comply with KRS § 362.2-408.
Terms Used In Kentucky Statutes 362.2-509
- Action: includes all proceedings in any court of this state. See Kentucky Statutes 446.010
- Contribution: means any benefit provided by a person to a limited partnership in
order to become a partner or in the person's capacity as a partner. See Kentucky Statutes 362.2-102 - General partner: means :
(a) With respect to a limited partnership, a person that:
1. See Kentucky Statutes 362.2-102 - Partner: means a limited partner or general partner. See Kentucky Statutes 362.2-102
- Partnership: A voluntary contract between two or more persons to pool some or all of their assets into a business, with the agreement that there will be a proportional sharing of profits and losses.
- Partnership: includes both general and limited partnerships. See Kentucky Statutes 446.010
- Person: means an individual, corporation, business trust, estate, trust, partnership, limited liability company, association, joint venture, government, governmental subdivision, agency, or instrumentality, or any other legal or commercial entity. See Kentucky Statutes 362.2-102
- Transferee: means a person to which all or part of a transferable interest has been transferred, whether or not the transferor is a partner. See Kentucky Statutes 362.2-102
(2) A partner or transferee that knew a distribution was made in violation of KRS
362.2-508 is personally liable to the limited partnership but only to the extent that the distribution received by the partner or transferee exceeded the amount that could have been properly paid under KRS § 362.2-508.
(3) A general partner against which an action is brought under subsection (1) of this section may:
(a) Implead in the action any other person that as a general partner consented to the distribution in violation of subsection (1) of this section and compel contribution from that person; and
(b) Implead in the action any person that received a distribution in violation of subsection (2) of this section and compel contribution from that person in the amount that person received in violation of subsection (2) of this section.
(4) A proceeding under this section is barred if it is not commenced within two (2)
years after the distribution.
Effective: July 12, 2006
History: Created 2006 Ky. Acts ch. 149, sec. 137, effective July 12, 2006.