Actions by Partners.

Ala. Code tit. 10A, ch. 9A, art. 9

in effect

Ala. Code § 10A-9A-9.01 Direct Action by Partner.

10A-9A-9.01. Direct Action by Partner. (a) Subject to subsection (b), a partner may maintain a direct action against another partner or partners or the limited partnership, with or without an accounting as to the partnership’s activities and affairs, to enforce the partner’s rights and otherwise protect the partner’s interests, including rights and interests under the partnership agreement or this chapter or arising independently of the partnership relationship. (b) A partner maintaining a direct action under subsection (a) must plead and prove an actual or threatened injury that is not solely the result of an injury suffered or threatened to be suffered by the limited partnership. (c) A partner may maintain a direct action to enforce a right of a limited partnership if all partners at the time of suit are parties to the action. (d) The accrual of, and any time limitation on, a right of action for a remedy under this section is governed by other law. (e) A right to an accounting upon a dissolution and winding up does not revive a claim barred by law. (Act 2016-379, §1.)

Ala. Code § 10A-9A-9.02 Right of Derivative Action.

10A-9A-9.02. Right of Derivative Action. A partner may commence or maintain a derivative action in the right of a limited partnership to enforce a right of the limited partnership by complying with this article. (Act 2016-379, §1, p. 934, ; Act 2025-281, §7.)

Ala. Code § 10A-9A-9.03 Standing.

10A-9A-9.03. Standing. A partner may commence or maintain a derivative action in the right of the limited partnership only if the partner: (1) fairly and adequately represents the interests of the limited partnership in enforcing the right of the limited partnership; and (2) either: (A) was a partner of the limited partnership at the time of the act or omission of which the partner complains; or (B) whose status as a partner devolved upon the person by operation of law or pursuant to the terms of the partnership agreement from a person who was a partner at the time of the act or omission of which the partner complains. (Act 2016-379, §1.)

Ala. Code § 10A-9A-9.04 Demand.

10A-9A-9.04. Demand. A partner may commence a derivative action in the right of the limited partnership, if: (a) the partner first makes a written demand upon general partners requesting that they cause the limited partnership to bring an action to enforce the right and the general partners do not bring the action within a reasonable time; or (b) a demand under subsection (a) would be futile. (Act 2016-379, §1.)

Ala. Code § 10A-9A-9.05 Pleading.

10A-9A-9.05. Pleading. In a derivative action, the complaint must state with particularity: (a) the date and content of plaintiff’s demand and the general partner’s response by the limited partnership to the demand; or (b) why the demand should be excused as futile. (Act 2016-379, §1.)

Ala. Code § 10A-9A-9.06 Stay of Proceedings.

10A-9A-9.06. Stay of Proceedings. For the purpose of allowing the general partners and the limited partnership time to undertake an inquiry into the allegations made in the demand or complaint commenced pursuant to this article, the court may stay any derivative action for the period the court deems appropriate. (Act 2016-379, §1.)

Ala. Code § 10A-9A-9.07 Discontinuance or Settlement.

10A-9A-9.07. Discontinuance or Settlement. A derivative action may not be dismissed or compromised without the approval of the court, and notice of the proposed dismissal or compromise shall be given to partners of the limited partnership in such manner as the court directs. (Act 2016-379, §1.)

Ala. Code § 10A-9A-9.08 Proceeds and Expenses.

10A-9A-9.08. Proceeds and Expenses. (a) Except as otherwise provided in subsection (b): (1) any proceeds or other benefits of a derivative action, whether by judgment, compromise, or settlement, belong to the limited partnership and not to the derivative plaintiff; and (2) if the derivative plaintiff receives any proceeds, the derivative plaintiff shall immediately remit them to the limited partnership. (b) If a derivative action is successful in whole or in part, the court may award the plaintiff reasonable expenses, including reasonable attorney’s fees, from the recovery of the limited partnership. (Act 2016-379, §1.)

Ala. Code § 10A-9A-9.09 Applicability to Foreign Limited Partnerships.

10A-9A-9.09. Applicability to Foreign Limited Partnerships. In any derivative action in the right of a foreign limited partnership, the right of a person to commence or maintain a derivative action in the right of a foreign limited partnership, and any matters raised in the action covered by Sections 10A-9A-9.02 through 10A-9A-9.08, shall be governed by the law of the jurisdiction under which the foreign limited partnership was formed; except that any matters raised in the action covered by Sections 10A-9A-9.06, 10A-9A-9.07, and 10A-9A-9.08 shall be governed by the law of this state. (Act 2016-379, §1.)

Source: Alabama Legislature (alison.legislature.state.al.us)URL: https://alison.legislature.state.al.us/code-of-alabamaFetched: 10/20/2026