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Civil law. Part II. Termination of a simple partnership agreement (the most important)

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94. TERMINATION OF A PARTNERSHIP AGREEMENT

Termination of a simple partnership agreement is carried out as a result of:

▪ declaring one of the partners incompetent, partially incapacitated or missing, unless the contract or subsequent agreement provides for the continuation of the agreement in relations between the other partners;

▪ declaring one of the partners insolvent (bankrupt);

▪ death of a partner or liquidation or reorganization of a legal entity participating in the agreement, unless the agreement or subsequent agreement provides for the preservation of the agreement in relations between the remaining partners or the replacement of the deceased partner (liquidated or reorganized legal entity) by his heirs (successors);

▪ refusal of any of the partners to further participate in an open-ended simple partnership agreement;

▪ termination of a simple partnership agreement, concluded with a specified period, at the request of one of the partners in relations between him and the other partners;

▪ expiration of the simple partnership agreement;

▪ allocation of a partner's share at the request of his creditor.

An application for the refusal of a partner from an open-ended simple partnership agreement must be made by him no later than three months before the expected withdrawal from the agreement (Article 1051 of the Civil Code).

A party to a simple partnership agreement concluded with an indication of a term or an indication of the purpose as a resolutive condition has the right to demand termination of the agreement in relations between itself and the other partners for a good reason with compensation to the rest of the partners for real damage caused by the termination of the agreement (Article 1052 of the Civil Code).

In the event that a simple partnership agreement has not been terminated as a result of a statement by one of the participants to refuse further participation in it or termination of the agreement at the request of one of the partners, the person whose participation in the agreement has ceased is liable to third parties for the general obligations arising during the period of his participation in the agreement, as if he had remained a participant in the simple partnership agreement (Article 1053 of the Civil Code).

Upon termination of a simple partnership agreement, things transferred to the common possession and (or) use of the partners shall be returned to the partners who provided them without compensation, unless otherwise provided by agreement of the parties.

From the moment of termination of the simple partnership agreement, its participants are jointly and severally liable for unfulfilled general obligations in relation to third parties (paragraph 2 of article 1050 of the Civil Code).

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