Bob

Issue: The court must determine the dissolution of partnership? Rules: Under Louisiana Law, the creditors of a partnership shall be paid in the following order of priority: 1. Secured creditors in accordance with their security rights; 2. Unsecured creditors who are not partners; and 3. Unsecured creditors who are partners. If any assets remain after the payment of all secured and unsecured creditors, 1. the capital contributions shall be restored to the partners, and 2. Finally, any surplus shall be divided among the partners proportionally based on their respective interests in the partnership.Under Louisiana Law, the liquidation of a partnership is not final until 1. all its assets have been collected; 2. applied to its obligations and its remaining assets, and3. if any, have been appropriately distributed to the partners.According to Claiborne & Mather vs. Their Creditors, the partnership asset should be applied to the debit of the partnership first. Individual partners debit are collected secondary to the partnership debit and is equal to partner share.

According to Succession of Chas. M. Pilcher, the debts of the partnership must be paid prior to any of the partners debts.

The partnership of property is liable to the creditors of the partnership in preference to those of the individual partner, but the share of any partner may, in due course of law, be seized and sold to satisfy his individual creditors, subject to the debts of the partnership.

According to Smith v. Senecal, when money is loan to a partner for the capital contribution of the partnership; the partner and not the partnership is liable to the creditor. Thus, a partner does have a cause of action for the reimbursement of the capital contribution in the partnership.

According to Gueringer vs. His Creditors, Individual Partners are secondary liable to the partnership creditors; however, partnership creditors (after dissolution of partnership share (discussion)) and individual creditors are equal to a share of the partners assets.