Legislature(1999 - 2000)

02/01/2000 09:04 AM FIN

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
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SENATE BILL NO. 165                                                                                                             
"An Act relating to the remedies available to judgment                                                                          
creditors against limited liability company members                                                                             
and their assignees and against limited partnership                                                                             
general and limited partners and their assignees; and                                                                           
providing for an effective date."                                                                                               
                                                                                                                                
                                                                                                                                
Senator ROBIN TAYLOR referred to the sponsor statement                                                                          
saying that he would not read it into the record.                                                                               
                                                                                                                                
Senator Taylor told the Committee of two differing court                                                                        
decisions addressing how a creditor would receive judgement                                                                     
taken against a member of a limited partnership. In the                                                                         
Florida case it was ruled that the creditor had the right                                                                       
to go after the limited partnership to obtain only that                                                                         
member's interest in the partnership to satisfy the debt.                                                                       
The other case was held in Connecticut. The court in this                                                                       
case allowed the judgement's creditor to foreclose upon the                                                                     
partnership's assets, which essentially destroyed the                                                                           
partnership. Senator Taylor asserted that the ruling made                                                                       
in the Connecticut case allows actions to be taken against                                                                      
a limited partnership that are beyond the control of the                                                                        
other members not involved in the judgement. If one member                                                                      
is sued then the entire partnership could be ruined, he                                                                         
stated. This bill relieves members of a limited partnership                                                                     
from that liability while still allowing the creditor of a                                                                      
specific member to receive that member's distribution from                                                                      
the partnership.                                                                                                                
                                                                                                                                
Co-Chair Torgerson commented that this bill is strait                                                                           
forward.                                                                                                                        
                                                                                                                                
Co-Chair Parnell offered a motion to move SB 165, 1-                                                                            
LS0919\A from Committee with accompanying zero fiscal note                                                                      
from the Department of Law and individual recommendations.                                                                      
There was no objection.                                                                                                         
                                                                                                                                

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