Dissolution and Winding Up.

Ala. Code tit. 10A, ch. 9A, art. 8

in effect

Ala. Code § 10A-9A-8.01 Events of Dissolution.

10A-9A-8.01. Events of Dissolution. A limited partnership is dissolved and its activities and affairs shall be wound up upon the occurrence of the first of the following events: (a) An event or circumstance that the partnership agreement states causes dissolution. (b) Consent of all partners to dissolve. (c) When there is no remaining general partner, unless either of the following applies: (1) All of the limited partners agree in writing, within 90 days after the dissociation of the last general partner, to continue the activities and affairs of the limited partnership and to admit one or more new general partners. (2) The activities and affairs of the limited partnership are continued and one or more new general partners are admitted in the manner stated in the partnership agreement. (d) When there is no remaining limited partner, unless either of the following applies: (1) All of the general partners agree in writing, within 90 days after the dissociation of the last limited partner, to continue the activities and affairs of the limited partnership and to admit one or more new limited partners. (2) The activities and affairs of the limited partnership are continued and one or more new limited partners are admitted in the manner stated in the partnership agreement. (e) When there are no remaining partners, unless either of the following applies: (1) The holders of all of the transferable interests in the limited partnership agree in writing, within 90 days after the dissociation of the last general partner, to continue the activities and affairs of the limited partnership and to admit one or more new general partners and one or more new limited partners. (2) The activities and affairs of the limited partnership are continued and one or more new general partners and one or more new limited partners are admitted in the manner stated in the partnership agreement. (f) On application by a partner, the entry of an order dissolving the limited partnership on the grounds that it is not reasonably practicable to carry on the limited partnership’s activities and affairs in conformity with the partnership agreement, which order is entered by the designated court, and if none, the circuit court for the county in which the limited partnership’s principal office within this state is located, and if the limited partnership does not have a principal office within this state then by the circuit court for the county in which the limited partnership’s most recent registered office is located. (Act 2016-379, p. 934, §1; Act 2020-73, §10.)

Ala. Code § 10A-9A-8.02 Effect of Dissolution.

10A-9A-8.02. Effect of Dissolution. (a) A dissolved limited partnership continues its existence as a limited partnership but may not carry on any activities and affairs except as is appropriate to wind up and liquidate its activities and affairs, including: (1) collecting its assets; (2) disposing of its properties that will not be distributed in kind to persons owning transferable interests; (3) discharging or making provisions for discharging its liabilities; (4) distributing its remaining property in accordance with Section 10A-9A-8.09; and (5) doing every other act necessary to wind up and liquidate its activities and affairs. (b) In winding up its activities and affairs, a limited partnership may: (1) deliver for filing a statement of dissolution to the Secretary of State setting forth: (A) The name of the limited partnership; (B) The unique identifying number or other designation as assigned by the Secretary of State; (C) That the limited partnership has dissolved; (D) The name and street mailing address of the general partner who will be winding up the affairs of the limited partnership pursuant to Section 10A-9A-8.03(a), and if none, the name and street address of the person appointed pursuant to Section 10A-9A-8.03(b) or (c) to wind up the activities and affairs of the limited partnership; and (E) Any other information the limited partnership deems appropriate; (2) preserve the limited partnership’s activities and affairs and property as a going concern for a reasonable time; (3) prosecute, defend, or settle actions or proceedings, whether civil, criminal, or administrative; (4) transfer the limited partnership’s assets; (5) resolve disputes by mediation or arbitration; and (6) merge or convert in accordance with Article 10 of this chapter or Article 8 of Chapter 1. (c) The dissolution of a limited partnership does not: (1) transfer title to the limited partnership’s property; (2) prevent the commencement of a proceeding by or against the limited partnership in its limited partnership name; (3) terminate, abate, or suspend a proceeding pending by or against the limited partnership on the effective date of dissolution; (4) terminate the authority of its registered agent; or (5) abate, suspend, or otherwise alter the application of Sections 10A-9A-3.03 and 10A-9A-4.04(b) and (c). (d) A statement of dissolution shall be deemed to be a filing instrument under Chapter 1. (Act 2016-379, p. 934, §1; Act 2020-73, §10; Act 2021-299, §5.)

Ala. Code § 10A-9A-8.03 Right to Wind Up Activities and Affairs.

10A-9A-8.03. Right to Wind Up Activities and Affairs. (a) If a dissolved limited partnership has a general partner or general partners that have not dissociated, that general partner or those general partners shall wind up the activities and affairs of the limited partnership and shall have the powers set forth in Section 10A-9A-8.04. (b) If a dissolved limited partnership does not have a general partner, a person or persons to wind up the dissolved limited partnership’s activities and affairs may be appointed by the consent of a majority of the limited partners. (c) The designated court, and if none, the circuit court for the county in which the limited partnership’s principal office within this state is located, and if the limited partnership does not have a principal office within this state then the circuit court for the county in which the limited partnership’s most recent registered office is located, may order judicial supervision of the winding up of a dissolved limited partnership, including the appointment of a person to wind up the limited partnership’s activities and affairs: (1) on application of a partner, if the applicant establishes good cause; (2) on application of a partner or transferee, if the limited partnership does not have a general partner and within a reasonable time following the dissolution no person having the authority to wind up the activities and affairs of the limited partnership has been appointed pursuant to subsection (b); (3) on application of a partner or transferee, if the limited partnership does not have a general partner and within a reasonable time following the dissolution the person appointed pursuant to subsection (b) is not winding up the activities and affairs of the limited partnership; or (4) in connection with a proceeding under Section 10A-9A-8.01(f). (d) A person appointed under subsection (b) or (c) is not a general partner but: (1) has the powers of a general partner under Section 10A-9A-8.04 but is not liable for the debts, liabilities, and other obligations of the limited partnership solely by reason of having or exercising those powers or otherwise acting to wind up the activities and affairs of the dissolved limited partnership; and (2) shall promptly deliver for filing a statement of dissolution to the Secretary of State setting forth the items listed in Section 10A-9A-8.02(b)(1) and the following: (A) that the limited partnership does not have a general partner; (B) the name and street mailing address of each person that has been appointed to wind up the activities and affairs of the limited partnership; (C) that each person has been appointed pursuant to this subsection to wind up the activities and affairs of the limited partnership; and (D) pursuant to this section, that each person has the powers of a general partner under Section 10A-9A-8.04 but is not liable for the debts, liabilities, and other obligations of the limited partnership solely by reason of having or exercising those powers or otherwise acting to wind up the activities and affairs of the dissolved limited partnership. (Act 2016-379, p. 934, §1; Act 2020-73, §10.)

Ala. Code § 10A-9A-8.04 Power of General Partner and Person Dissociated as General Partner to Bind Partnership After Dissolution.

10A-9A-8.04. Power of General Partner and Person Dissociated as General Partner to Bind Partnership After Dissolution. (a) A limited partnership is bound by a general partner’s act after dissolution which: (1) is appropriate for winding up the limited partnership’s activities and affairs; or (2) would have bound the limited partnership under Section 10A-9A-4.02 before dissolution, if, at the time the other party enters into the transaction, the other party does not have notice of the dissolution. (b) A person dissociated as a general partner binds a limited partnership through an act occurring after dissolution only if: (1) at the time the other party enters into the transaction the other party does not have notice of the dissociation and reasonably believes that the person is a general partner; and (2) the act: (A) is appropriate for winding up the limited partnership’s activities and affairs; or (B) would have bound the limited partnership under Section 10A-9A-4.02 before dissolution and at the time the other party enters into the transaction the other party does not have notice of the dissolution. (Act 2016-379, §1.)

Ala. Code § 10A-9A-8.05 Liability After Dissolution of General Partner and Person Dissociated as General Partner to Limited Partnership, Other General Partners, and Persons Dissociated as General Partner.

10A-9A-8.05. Liability After Dissolution of General Partner and Person Dissociated as General Partner to Limited Partnership, Other General Partners, and Persons Dissociated as General Partner. (a) If a general partner having knowledge of the dissolution causes a limited partnership to incur an obligation under Section 10A-9A-8.04(a) by an act that is not appropriate for winding up the partnership’s activities and affairs, the general partner is liable: (1) to the limited partnership for any damage caused to the limited partnership arising from the obligation; and (2) if another general partner or a person dissociated as a general partner is liable for the obligation, to that other general partner or person for any damage caused to that other general partner or person arising from the liability. (b) If a person dissociated as a general partner causes a limited partnership to incur an obligation under Section 10A-9A-8.04(b), the person is liable: (1) to the limited partnership for any damage caused to the limited partnership arising from the obligation; and (2) if a general partner or another person dissociated as a general partner is liable for the obligation, to the general partner or other person for any damage caused to the general partner or other person arising from the liability. (Act 2016-379, §1.)

Ala. Code § 10A-9A-8.06 Known Claims Against Dissolved Limited Partnership.

10A-9A-8.06. Known Claims Against Dissolved Limited Partnership. (a) A dissolved limited partnership may dispose of any known claims against it by following the procedures described in subsection (b) at any time after the effective date of the dissolution of the limited partnership. (b) A dissolved limited partnership may give notice of the dissolution in a record to the holder of any known claim. The notice must: (1) identify the dissolved limited partnership; (2) describe the information required to be included in a claim; (3) provide a mailing address to which the claim is to be sent; (4) state the deadline, which may not be fewer than 120 days from the effective date of the notice, by which the dissolved partnership must receive the claim; (5) state that if not sooner barred, the claim will be barred if not received by the deadline; and (6) unless the limited partnership has been throughout its existence a limited liability limited partnership, state that the barring of a claim against the limited partnership will also bar any corresponding claim against any general partner or person dissociated as a general partner which is based on Section 10A-9A-4.04. (c) Unless sooner barred by any other statute limiting actions, a claim against a dissolved limited partnership is barred: (1) if a claimant who was given notice under subsection (b) does not deliver the claim to the dissolved limited partnership by the deadline; or (2) if a claimant whose claim was rejected by the dissolved limited partnership, does not commence a proceeding to enforce the claim within 90 days from the effective date of the rejection notice. (d) For purposes of this section, “known claim” or “claim” includes unliquidated claims, but does not include a contingent liability that has not matured so that there is no immediate right to bring suit or a claim based on an event occurring after the effective date of dissolution. (e) Nothing in this section shall be deemed to extend any otherwise applicable statute of limitations. (Act 2016-379, p. 934, §1; Act 2021-299, §5.)

Ala. Code § 10A-9A-8.07 Other Claims Against Dissolved Limited Partnership.

10A-9A-8.07. Other Claims Against Dissolved Limited Partnership. (a) A dissolved limited partnership may publish notice of its dissolution and request that persons with claims against the dissolved limited partnership present them in accordance with the notice. (b) The notice authorized by subsection (a) must: (1) be published at least one time in a newspaper of general circulation in the county in which the dissolved limited partnership’s principal office is located in this state, and if none in this state, in the county in which the limited partnership’s most recent registered office is located; (2) describe the information that must be included in a claim and provide a mailing address to which the claim is to be sent; (3) state that if not sooner barred, a claim against the dissolved limited partnership will be barred unless a proceeding to enforce the claim is commenced within two years after the publication of the notice; and (4) unless the limited partnership has been throughout its existence a limited liability limited partnership, state that the barring of a claim against the limited partnership will also bar any corresponding claim against any general partner or person dissociated as a general partner which is based on Section 10A-9A-4.04. (c) If a dissolved limited partnership publishes a newspaper notice in accordance with subsection (b), unless sooner barred by any other statute limiting actions, the claim of each of the following claimants is barred unless the claimant commences a proceeding to enforce the claim against the dissolved limited partnership within two years after the publication date of the newspaper notice: (1) a claimant who was not given notice under Section 10A-9A-8.06; (2) a claimant whose claim was timely sent to the dissolved limited partnership but not acted on by the dissolved limited partnership; and (3) a claimant whose claim is contingent at the effective date of the dissolution of the limited partnership, or is based on an event occurring after the effective date of the dissolution of the limited partnership. (d) A claim that is not barred under this section, any other statute limiting actions, or Section 10A-9A-8.06 may be enforced: (1) against a dissolved limited partnership, to the extent of its undistributed assets; (2) except as provided in subsection (h), if the assets of a dissolved limited partnership have been distributed after dissolution, against the person or persons owning the transferable interests to the extent of that person’s proportionate share of the claim or of the assets distributed to that person after dissolution, whichever is less, but a person’s total liability for all claims under subsection (d) may not exceed the total amount of assets distributed to that person after dissolution of the limited partnership; or (3) against any person liable on the claim under Section 10A-9A-4.04 and 10A-9A-6.07. (e) A dissolved limited partnership that published a notice under this section may file an application with the designated court, and if none the circuit court for the county in which the dissolved limited partnership’s principal office is located in this state and if the dissolved limited partnership does not have a principal office within this state, in the circuit court for the county in which the dissolved limited partnership’s most recent registered office is located, for a determination of the amount and form of security to be provided for payment of claims that are contingent or have not been made known to the dissolved limited partnership or that are based on an event occurring after the effective date of the dissolution of the limited partnership but that, based on the facts known to the dissolved limited partnership, are reasonably estimated to arise after the effective date of the dissolution of the limited partnership. Provision need not be made for any claim that is or is reasonably anticipated to be barred under subsection (c). (f) Within 10 days after the filing of the application provided for in subsection (e), notice of the proceeding shall be given by the dissolved limited partnership to each potential claimant as described in subsection (e). (g) The circuit court under subsection (e) may appoint a guardian ad litem to represent all claimants whose identities are unknown in any proceeding brought under this section. The reasonable fees and expenses of the guardian, including all reasonable expert witness fees, shall be paid by the dissolved limited partnership. (h) Provision by the dissolved limited partnership for security in the amount and the form ordered by the circuit court under subsection (e) shall satisfy the dissolved limited partnership’s obligation with respect to claims that are contingent, have not been made known to the dissolved limited partnership, or are based on an event occurring after the effective date of the dissolution of the limited partnership, and those claims may not be enforced against a person owning a transferable interest to whom assets have been distributed by the dissolved limited partnership after the effective date of the dissolution of the limited partnership. (i) Nothing in this section shall be deemed to extend any otherwise applicable statute of limitations. (j) If a claim has been satisfied, disposed of, or barred under Section 10A-9A-8.06, this section, or other law, the person or persons designated to wind up the affairs of a limited partnership, and the owners of the transferable interests receiving assets from the limited partnership, shall not be liable for that claim. (Act 2016-379, p. 934, §1; Act 2020-73, §10; Act 2021-299, §5.)

Ala. Code § 10A-9A-8.08 Liability of General Partner and Person Dissociated as General Partner When Claim Against Limited Partnership Barred.

10A-9A-8.08. Liability of General Partner and Person Dissociated as General Partner When Claim Against Limited Partnership Barred. If a claim against a dissolved limited partnership is barred under Section 10A-9A-8.06 or 10A-9A-8.07, any corresponding claim under Section 10A-9A-4.04 or 10A-9A-6.07 is also barred. (Act 2016-379, §1.)

Ala. Code § 10A-9A-8.09 Disposition of Assets, When Contributions Required.

10A-9A-8.09. Disposition of Assets, When Contributions Required. Upon the winding up of a limited partnership, the assets of the limited partnership, including any obligation under Article 5 of this chapter, and any contribution required by this section, shall be applied as follows: (a) Payment, or adequate provision for payment, shall be made to creditors, including, to the extent permitted by law, partners who are creditors, in satisfaction of liabilities of the limited partnership. (b) After a limited partnership complies with subsection (a), any surplus must be distributed: (1) first, to each person owning a transferable interest that reflects contributions made on account of the transferable interest and not previously returned, an amount equal to the value of the person’s unreturned contributions; and (2) then to each person owning a transferable interest in the proportions in which the owners of transferable interests share in distributions before dissolution. (c) If the limited partnership does not have sufficient surplus to comply with subsection (b)(1), any surplus must be distributed among the owners of transferable interests in proportion to the value of their respective unreturned contributions. (d) If a limited partnership’s assets are insufficient to satisfy all of its obligations under subsection (a), with respect to each unsatisfied obligation incurred when the limited partnership was not a limited liability limited partnership, the following rules apply: (1) Each person that was a general partner when the obligation was incurred and that has not been released from the obligation under Section 10A-9A-6.07 shall contribute to the limited partnership for the purpose of enabling the limited partnership to satisfy the obligation. The contribution due from each of those persons is in proportion to the right to receive distributions in the capacity of general partner in effect for each of those persons when the obligation was incurred. (2) If a person does not contribute the full amount required under paragraph (1) with respect to an unsatisfied obligation of the limited partnership, the other persons required to contribute by paragraph (1) on account of the obligation shall contribute the additional amount necessary to discharge the obligation. The additional contribution due from each of those other persons is in proportion to the right to receive distributions in the capacity of general partner in effect for each of those other persons when the obligation was incurred. (3) If a person does not make the additional contribution required by paragraph (2), further additional contributions are determined and due in the same manner as provided in that paragraph. (e) A person that makes an additional contribution under subsection (d)(2) or (3) may recover from any person whose failure to contribute under subsection (d)(1) or (2) necessitated the additional contribution. A person may not recover under this subsection more than the amount additionally contributed. A person’s liability under this subsection may not exceed the amount the person failed to contribute. (f) The estate of a deceased individual is liable for the person’s obligations under this section. (g) An assignee for the benefit of creditors of a limited partnership or a partner, or a person appointed by a court to represent creditors of a limited partnership or a partner, may enforce a person’s obligation to contribute under subsection (d). (Act 2016-379, p. 934, §1; Act 2021-299, §5.)

Ala. Code § 10A-9A-8.10 Reinstatement After Dissolution.

10A-9A-8.10. Reinstatement After Dissolution. A limited partnership that has been dissolved may be reinstated upon compliance with the following conditions: (a) the consent shall have been obtained from the partners or other persons entitled to consent at the time that is: (1) required for reinstatement under the partnership agreement; or (2) if the partnership agreement does not state the consent required for reinstatement, sufficient for dissolution under the partnership agreement; or (3) if the partnership agreement neither states the consent required for reinstatement nor for dissolution, sufficient for dissolution under this chapter; (b) in the case of a written objection to reinstatement having been delivered to the limited partnership before or at the time of the consent required by subsection (a) by the partners or other persons having authority under the partnership agreement to bring about or prevent dissolution of the limited partnership, those partners or persons withdrawing that written objection effective at the time of the consent required by subsection (a); (c) in the case of a limited partnership dissolved in a judicial proceeding initiated by one or more of the partners, the consent of each of those partners shall have been obtained and shall be included in the consent required by subsection (a); and (d) the filing of a certificate of reinstatement in accordance with Section 10A-9A-8.11. (Act 2016-379, p. 934, §1; Act 2021-299, §5.)

Ala. Code § 10A-9A-8.11 Certificate of Reinstatement.

10A-9A-8.11. Certificate of Reinstatement. (a) In order to reinstate a limited partnership under this article, a certificate of reinstatement shall be delivered for filing to the Secretary of State which certificate of reinstatement shall have attached thereto a true and complete copy of the limited partnership’s certificate of formation. The certificate of reinstatement shall state: (1) the name of the limited partnership before reinstatement; (2) the name of the limited partnership following reinstatement, which limited partnership name shall comply with Section 10A-9A-8.12; (3) the date of formation of the limited partnership; (4) the date of dissolution of the limited partnership, if known; (5) a statement that all applicable conditions of Section 10A-9A-8.10 have been satisfied; (6) the address of the registered office and the name of the registered agent at that address in compliance with Article 5 of Chapter 1; and (7) the unique identifying number or other designation as assigned by the Secretary of State. (b) A limited partnership shall not be required to file a statement of dissolution in order to file a certificate of reinstatement. (c) A certificate of reinstatement shall be deemed to be a filing instrument under Chapter 1. (Act 2016-379, p. 934, §1; Act 2020-73, §10.)

Ala. Code § 10A-9A-8.12 Limited Partnership Name Upon Reinstatement.

10A-9A-8.12. Limited Partnership Name Upon Reinstatement. The name of a limited partnership following reinstatement shall be determined as follows: (a) If the limited partnership remains in the Secretary of State’s records as a limited partnership which has not been dissolved, then the name of the limited partnership following reinstatement shall be that limited partnership name at the time of reinstatement. (b) If the limited partnership is listed in the Secretary of State’s records as a limited partnership that has been dissolved, then the name of a limited partnership following reinstatement shall be that limited partnership name at the time of reinstatement if that limited partnership name complies with Article 5 of Chapter 1 at the time of reinstatement. If that limited partnership name does not comply with Article 5 of Chapter 1, the name of the limited partnership following reinstatement shall be that limited partnership name followed by the word “reinstated.” (c) A limited partnership shall not be required to file a statement of dissolution in order to retain or obtain the name of the limited partnership. (Act 2016-379, §1.)

Ala. Code § 10A-9A-8.13 Effect of Reinstatement.

10A-9A-8.13. Effect of Reinstatement. (a) Subject to subsection (b), upon reinstatement, the limited partnership shall be deemed for all purposes to have continued its activities and affairs as if dissolution had never occurred; and each right inuring to, and each debt, obligation, and liability incurred by, the limited partnership after the dissolution shall be determined as if the dissolution had never occurred. (b) The rights of persons acting in reliance on the dissolution before those persons had notice of the reinstatement shall not be adversely affected by the reinstatement. (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