(a) Upon the winding up of a limited partnership, the assets shall be distributed as follows:
Terms Used In Tennessee Code 61-2-804
Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
Liabilities: The aggregate of all debts and other legal obligations of a particular person or legal entity.
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 agreement: means any agreement, written or oral, of the partners as to the affairs of a limited partnership and the conduct of its business. See Tennessee Code 61-2-101
Person: means a natural person, a foreign or domestic partnership (whether general or limited), trust, estate, association, corporation, custodian, nominee or any other individual or entity in its own or any representative capacity. See Tennessee Code 61-2-101
Trustee: A person or institution holding and administering property in trust.
(1) To creditors, including partners who are creditors, to the extent otherwise permitted by law, in satisfaction of liabilities of the limited partnership (whether by payment or the making of reasonable provisions for payment thereof) other than liabilities for which reasonable provision for payment has been made and liabilities for distributions to partners under § 61-2-601 or § 61-2-604;(2) Unless otherwise provided in the partnership agreement, to partners and former partners in satisfaction of liabilities for distributions under § 61-2-601 or § 61-2-604; and(3) Unless otherwise provided in the partnership agreement, to partners first for the return of their contributions, and second respecting their partnership interests, in the proportions in which the partners share in distributions.(b) A limited partnership which has dissolved shall pay or make reasonable provision to pay all claims and obligations, including all contingent, conditional or unmatured claims and obligations, known to the limited partnership and all claims and obligations which are known to the limited partnership but for which the identity of the claimant is unknown. If there are sufficient assets, such claims and obligations shall be paid in full and any such provision for payment made shall be made in full. If there are insufficient assets, such claims and obligations shall be paid or provided for according to their priority and, among claims and obligations of equal priority, ratably to the extent of assets available therefor. Unless otherwise provided in a partnership agreement, any remaining assets shall be distributed as provided in this chapter. Any liquidating trustee winding up a limited partnership’s affairs who has complied with this section shall not be personally liable to the claimants of the dissolved limited partnership by reason of such person‘s actions in winding up the limited partnership.
