Guam § 25613 - Liability of Persons Continuing the Business in Certain Cases.

§ 25613. Liability of Persons Continuing the Business in Certain Cases.

(1) When any new partner is admitted into an existing partnership, or

when any partner retires and assigns (or the representative of the deceased

partner assigns) his rights in the partnership property to two or more of the

partners, or to one or more of the partners and one or more third persons, if

the business is continued without liquidation of the partnership affairs,

creditors of the first or dissolved partnership are also creditors of the

partnership so continuing the business.

(2) When all but one partner retire and assign (or the representative of

a deceased partner assigns) their rights in partnership property to the

remaining partner, who continues the business without liquidation of

partnership affairs, either alone or with others, creditors of the dissolved

partnership are also creditors of the person or partnership so continuing the

business.

(3) When any partner retires or dies and the business of the dissolved

partnership is continued as set forth in paragraphs (1) and (2) of this section,

with the consent of the retired partners or the representative of the deceased

partner, but without any assignment of his right in partnership property,

rights of creditors of the dissolved partnership and of the creditors of the

person or partnership continuing the business shall be as if such assignment

had been made.

(4) When all partners or their representatives assign their rights in

partnership property to one or more third persons who promise to pay the

COL070307

18 GCA BUSINESS S TRUCTURE & FUNCTION

debts and who continue the business of the dissolved partnership, creditors

of the dissolved partnership are also creditors of the person or partnership

continuing the business.

(5) When any partner wrongfully causes dissolution and the remaining

partners continue the business under the provisions of § 25610(2)(b) either

alone or with others, and without liquidation of the partnership affairs,

creditors of the dissolved partnership are also creditors of the person or

partnership continuing the business.

(6) When a partner is expelled and the remaining partners continue the

business either alone or with others, without liquidation of the partnership

affairs, creditors of the dissolved partnership are also creditors of the person

or partnership continuing the business.

(7) The liability of a third person, becoming a partner is a partnership

continuing the business, under this section, to the creditors of the dissolved

partnership shall be satisfied out of partnership property only.

(8) When the business of a partnership after dissolution is continued

under any conditions set forth in this section, the creditors of the dissolved

partnership, as against the separate creditors of the retiring or deceased

partner or the representative of the deceased partner, have a prior right to

any claim of the retired partner or the representative of the deceased partner

against the person or partnership continuing the business, on account of the

retired or deceased partner's interest in the dissolved partnership or on

account of any consideration promised for such interest or for his right in

partnership property.

(9) Nothing in this section shall be held to modify any right of creditors

to set aside any assignment on the ground of fraud.

(10) The use by the person or partnership continuing the business of

the partnership name, or the name of the deceased partner as part thereof,

shall not of itself make the individual property of the deceased partner liable

for any debts contracted by such person or partnership.