Utah Code 48-1d-603. Transfer of transferable interest

(1)

A transfer, in whole or in part, of a transferable interest:

Terms Used In Utah Code 48-1d-603

Equitable: Pertaining to civil suits in "equity" rather than in "law." In English legal history, the courts of "law" could order the payment of damages and could afford no other remedy. See damages. A separate court of "equity" could order someone to do something or to cease to do something. See, e.g., injunction. In American jurisprudence, the federal courts have both legal and equitable power, but the distinction is still an important one. For example, a trial by jury is normally available in "law" cases but not in "equity" cases. ^{Source: U.S. Courts}
Partner: means a person that:

(a)	has become a partner in a partnership under Section 48-1d-401 or was a partner in a partnership when the partnership became subject to this chapter under Section 48-1d-1405; and

(b)

has not dissociated as a partner under Section 48-1d-701. See Utah Code 48-1d-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: means an association of two or more persons to carry on as co-owners a business for profit formed under this chapter or that becomes subject to this chapter under 10, or Section 48-1d-1405. See Utah Code 48-1d-102

Partnership agreement: means the agreement, whether or not referred to as a partnership agreement, and whether oral, implied, in a record, or in any combination thereof, of all the partners of a partnership concerning the matters described in Subsection 48-1d-106(1). See Utah Code 48-1d-102

Person: means an individual, business corporation, nonprofit corporation, partnership, limited partnership, limited liability company, limited cooperative association, unincorporated nonprofit association, statutory trust, business trust, common-law business trust, estate, trust, association, joint venture, public corporation, government or governmental subdivision, agency, or instrumentality, or any other legal or commercial entity. See Utah Code 48-1d-102

Transfer: includes :

(a)	an assignment;

(b)	a conveyance;

(c)

a sale;

(d)

a lease;

(e)	an encumbrance, including a mortgage or security interest;

(f)	a gift; and

(g)

a transfer by operation of law. See Utah Code 48-1d-102

Transferable interest: means the right, as initially owned by a person in the person's capacity as a partner, to receive distributions from a partnership in accordance with the partnership agreement, whether or not the person remains a partner or continues to own any part of the right. See Utah Code 48-1d-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 Utah Code 48-1d-102

(a)

is permissible;

(b)	does not by itself cause a person‘s dissociation or a dissolution and winding up of the partnership‘s activities and affairs; and

(c)

subject to Section 48-1d-605, does not entitle the transferee to:

(i)	participate in the management or conduct of the partnership‘s activities and affairs; or

(ii)	except as otherwise provided in Subsection (3), have access to records or other information concerning the partnership’s activities and affairs.

(2)

A transferee has the right to:

(a)	receive, in accordance with the transfer, distributions to which the transferor would otherwise be entitled; and

(b)	seek under Subsection 48-1d-901(5) a judicial determination that it is equitable to wind up the partnership’s activities and affairs.

(3)	In a dissolution and winding up of a partnership, a transferee is entitled to an account of the partnership’s transactions only from the date of the last account agreed to by the partners.

(4)	A partnership need not give effect to a transferee’s rights under this section until the partnership knows or has notice of the transfer.

(5)	A transfer of a transferable interest in violation of a restriction on transfer contained in the partnership agreement is ineffective as to a person having knowledge or notice of the restriction at the time of transfer.

(6)	Except as otherwise provided in Subsection 48-1d-701(4)(b), if a partner transfers a transferable interest, the transferor retains the rights of a partner other than the transferable interest transferred and retains all duties and obligations of a partner.

(7)	If a partner transfers a transferable interest to a person that becomes a partner with respect to the transferred interest, the transferee is liable for the transferor’s obligations under Sections 48-1d-502 and 48-1d-505 known to the transferee when the transferee becomes a partner.

Enacted by Chapter 412, 2013 General Session

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