You can sue a Minnesota business partner who walks away, but only for specific legal wrongs. Minnesota’s partnership statute does not use the term abandonment for a partner’s departure. Chapter 323A of the Minnesota Statutes, which the statute names the Uniform Partnership Act (1994) (Minn. Stat. § 323A.1201), calls a partner’s departure dissociation. A departing partner owes damages when the departure is wrongful under the statute, or when the partner breached the partnership agreement or a duty owed to the partnership. In a partnership whose partners have not agreed to remain partners until the expiration of a definite term or the completion of a particular undertaking, leaving is wrongful only if it breaks an express term of the agreement.

The statute is the primary source of law here, and your partnership agreement comes first. Under Minn. Stat. § 323A.0103(a), “To the extent the partnership agreement does not otherwise provide, this chapter governs relations among the partners and between the partners and the partnership.” This page covers Minnesota general partnerships, including limited liability partnerships and partnerships formed without a written agreement. An LLC member who leaves is governed by chapter 322C instead, which has its own wrongful-departure damages rule in Minn. Stat. § 322C.0601, subd. 3; the page on an LLC member who resigns covers that path. Other disputes between co-owners are collected under Minnesota ownership disputes.

What does Minnesota law call a partner who abandons the business?

Minnesota law calls it dissociation, and the main trigger is the partnership’s “notice of the partner’s express will to withdraw as a partner” (Minn. Stat. § 323A.0601(1)). A partner who stops showing up has not necessarily dissociated, because absence is not one of the events the statute lists.

The statute gives every partner the power to leave. Under Minn. Stat. § 323A.0602(a), “A partner has the power to dissociate at any time, rightfully or wrongfully, by express will pursuant to section 323A.0601(1).” Whether the partnership has notice is a question of fact. Under Minn. Stat. § 323A.0102(b), a person has notice of a fact when the person knows it or has received a notification of it. A person also has notice when the person “has reason to know it exists from all of the facts known to the person at the time in question.” The partnership is a person other than an individual, and under subsection (f), a partner’s notice of a fact relating to the partnership “is effective immediately as knowledge by, notice to, or receipt of a notification by the partnership,” except in a fraud on the partnership committed by or with that partner’s consent.

Silence leaves the date of departure open, and the date drives the buyout value, the end of the partner’s management rights, and the partner’s exposure to new debts. I suggest asking the absent partner, in writing, whether they are withdrawing and as of what date, because a written answer settles the question the statute turns on. The page on a partner who stops responding covers the practical steps while you wait.

When can you sue a partner for walking away?

You can recover damages for the departure itself only if it is wrongful. Under Minn. Stat. § 323A.0602(b), “A partner’s dissociation is wrongful only if” it breaches an express provision of the partnership agreement, or, in a partnership for a definite term or particular undertaking, it happens early in one of the four ways subsection (b)(2) lists. An early withdrawal by express will is not wrongful when “the withdrawal follows within 90 days after another partner’s dissociation by death or otherwise under section 323A.0601(6) to (10) or wrongful dissociation under this subsection” (subsection (b)(2)(i)).

The two routes to wrongful dissociation are narrow:

  1. Breach of an express term. The departure is wrongful if “it is in breach of an express provision of the partnership agreement” (subsection (b)(1)). A clause requiring a partner to stay, or to give notice before leaving, is the kind of term this reaches.
  2. Leaving a term partnership early in a listed way. In “a partnership for a definite term or particular undertaking, before the expiration of the term or the completion of the undertaking” (subsection (b)(2)), the departure is wrongful only if the partner withdraws by express will, “the partner is expelled by judicial determination under section 323A.0601(5),” “the partner is dissociated by becoming a debtor in bankruptcy,” or, “in the case of a partner who is not an individual, trust other than a business trust, or estate, the partner is expelled or otherwise dissociated because it willfully dissolved or terminated.”

When a departure is wrongful, “A partner who wrongfully dissociates is liable to the partnership and to the other partners for damages caused by the dissociation. The liability is in addition to any other obligation of the partner to the partnership or to the other partners” (§ 323A.0602(c)).

A rightful departure can still carry a claim for what the partner did before leaving. “A partnership may maintain an action against a partner for a breach of the partnership agreement, or for the violation of a duty to the partnership, causing harm to the partnership” (Minn. Stat. § 323A.0405(a)). Under subsection (b), a partner may sue another partner “for legal or equitable relief, with or without an accounting as to partnership business.” Under subsection (c), “The accrual of, and any time limitation on, a right of action for a remedy under this section is governed by other law,” so for a claim for breach of the agreement or of a duty, the filing deadline comes from other law, and I suggest identifying it early. The action to set a buyout price is different: § 323A.0701(i) states its own window, quoted in the buyout section below. The forms of relief are described in remedies for a breach of fiduciary duty.

What duties does a departing partner still owe?

After dissociation, a partner’s right to manage the business ends and the statutory duty not to compete ends. The partner’s other duties of loyalty and care continue, but only for matters that arose before the departure, under Minn. Stat. § 323A.0603(b).

The statute splits the duties this way:

  1. Management. “the partner’s right to participate in the management and conduct of the partnership business terminates, except as otherwise provided in section 323A.0803” (the winding-up exception).
  2. Competition. “the partner’s duty of loyalty under section 323A.0404(b)(3) terminates.” That duty is the one “to refrain from competing with the partnership in the conduct of the partnership business before the dissolution of the partnership” (Minn. Stat. § 323A.0404(b)(3)).
  3. Everything else. The remaining loyalty duties and the duty of care “continue only with regard to matters arising and events occurring before the partner’s dissociation, unless the partner participates in winding up the partnership’s business pursuant to section 323A.0803.”

The duty of care is narrow. Under § 323A.0404(c), it “is limited to refraining from engaging in grossly negligent or reckless conduct, intentional misconduct, or a knowing violation of law.” A claim under the statutory duty of care that rests on a partner’s absence alone has to fit within those words. A partner who left with a deal the partnership was pursuing raises a loyalty question instead, which the page on fiduciary duties partners owe each other explains.

How does a partner’s withdrawal affect a partnership at will?

In a partnership at will, a partner’s withdrawal by express will dissolves the partnership, and its business must be wound up. After dissolution, the partnership continues only to wind up its business, unless all partners waive winding up or the partnership agreement provides a different rule.

A partnership at will is “a partnership in which the partners have not agreed to remain partners until the expiration of a definite term or the completion of a particular undertaking” (Minn. Stat. § 323A.0101(10)). Partners who never signed an agreement and never agreed to a term or undertaking are in one. For that partnership, Minn. Stat. § 323A.0801(1) makes dissolution follow “the partnership’s having notice from a partner, other than a partner who is dissociated under section 323A.0601(2) to (10), of that partner’s express will to withdraw as a partner, or on a later date specified by the partner.”

Dissolution can be reversed. Under Minn. Stat. § 323A.0802(b), “all of the partners, including any dissociating partner other than a wrongfully dissociating partner, may waive the right to have the partnership’s business wound up and the partnership terminated.” When the departure was rightful, that waiver needs the departing partner’s agreement. Without a waiver, under Minn. Stat. § 323A.0803(c), “A person winding up a partnership’s business may preserve the partnership business or property as a going concern for a reasonable time,” and may “dispose of and transfer the partnership’s property.” Which set of rules applies next depends on this step: under § 323A.0603(a), a dissociation that dissolves the partnership sends the partners to the winding-up sections, and one that does not sends them to the buyout sections. On winding up, “Each partner is entitled to a settlement of all partnership accounts upon winding up the partnership business,” and “The partnership shall make a distribution to a partner in an amount equal to any excess of the credits over the charges in the partner’s account” (Minn. Stat. § 323A.0807(b)).

How does the buyout of a departing partner work?

When a partner’s departure does not dissolve the partnership, the partnership must buy the departing partner’s interest. Under Minn. Stat. § 323A.0701(a), “the partnership shall cause the dissociated partner’s interest in the partnership to be purchased for a buyout price determined pursuant to subsection (b).” The partnership must also indemnify the departing partner, except against liabilities the partner creates by acting for the business after leaving, and must pay its own estimate of the price if no agreement is reached within the statutory period after a written demand.

A departure from a partnership for a definite term or particular undertaking can still dissolve it. Under Minn. Stat. § 323A.0801(2)(i), such a partnership is dissolved by “the express will of at least half of the remaining partners to dissolve the partnership business” given “within 90 days after a partner’s dissociation by death or otherwise under section 323A.0601(6) to (10) or wrongful dissociation under section 323A.0602(b),” and under clause (3) any partnership is dissolved by “an event agreed to in the partnership agreement resulting in the winding up of the partnership business.” Check the current text of § 323A.0801 before relying on that period.

The statute sets the price and the procedure:

  1. Price. The price is what the partner would have received “if, on the date of dissociation, the assets of the partnership were sold at a price equal to the greater of the liquidation value or the value based on a sale of the entire business as a going concern without the dissociated partner and the partnership were wound up as of that date” (subsection (b)). Interest runs from the date of dissociation.
  2. Offsets. “Damages for wrongful dissociation under section 323A.0602(b), and all other amounts owing, whether or not presently due, from the dissociated partner to the partnership, must be offset against the buyout price” (subsection (c)).
  3. Indemnity. The partnership must indemnify the departing partner against partnership liabilities, “except liabilities incurred by an act of the dissociated partner under section 323A.0702” (subsection (d)).
  4. Payment after a written demand. “If no agreement for the purchase of a dissociated partner’s interest is reached within 120 days after a written demand for payment, the partnership shall pay, or cause to be paid, in cash to the dissociated partner the amount the partnership estimates to be the buyout price and accrued interest, reduced by any offsets and accrued interest under subsection (c)” (subsection (e)). Under subsection (g), that payment must come with a statement of assets and liabilities, the latest balance sheet and income statement, and an explanation of the calculation.
  5. Deferral for an early, wrongful exit. A partner who wrongfully leaves a term or undertaking partnership early “is not entitled to payment of any portion of the buyout price until the expiration of the term or completion of the undertaking,” unless a court finds earlier payment will not cause undue hardship to the business (subsection (h)).

Under subsection (g), the payment must also carry “written notice that the payment is in full satisfaction of the obligation to purchase unless, within 120 days after the written notice, the dissociated partner commences an action to determine the buyout price, any offsets under subsection (c), or other terms of the obligation to purchase.” A departing partner who disputes the figure can sue to have a court set it, and subsection (i) states the window: “The action must be commenced within 120 days after the partnership has tendered payment or an offer to pay or within one year after written demand for payment if no payment or offer to pay is tendered.” Check the current text of § 323A.0701 before relying on that period. A former partner may inspect the partnership’s books for the period they were a partner under Minn. Stat. § 323A.0403(b), the same records-access right described in an owner’s right to company records. Valuation and negotiation are covered in buying out a Minnesota co-owner.

What happens to the departing partner’s personal liability?

Leaving does not erase what a partner already owes. Under Minn. Stat. § 323A.0703(a), “A partner’s dissociation does not of itself discharge the partner’s liability for a partnership obligation incurred before dissociation.” In a general partnership, that liability is personal, joint, and several. For the purposes of § 323A.0306, “All partnership debts and obligations under or relating to a note, contract, or other agreement are incurred when the note, contract, or other agreement is entered into,” and a later amendment, modification, extension, or renewal does not change that time (subsection (d)).

Minn. Stat. § 323A.0306(a) provides that “all partners are liable jointly and severally for all obligations of the partnership unless otherwise agreed by the claimant or provided by law.” One exception changes the answer for partners in a limited liability partnership: “An obligation of a partnership incurred while the partnership is a limited liability partnership, whether arising in contract, tort, or otherwise, is solely the obligation of the partnership” (subsection (c)). Under § 323A.0603(a), “If a partner’s dissociation results in a dissolution and winding up of the partnership business, sections 323A.0801 to 323A.0807 apply; otherwise, sections 323A.0701 to 323A.0705 apply,” so the release and new-transaction rules below reach only a departure that does not dissolve the partnership. For that departure, a release from an old debt can come by agreement: “By agreement with the partnership creditor and the partners continuing the business, a dissociated partner may be released from liability for a partnership obligation” (§ 323A.0703(c)). Under subsection (d), “A dissociated partner is released from liability for a partnership obligation if a partnership creditor, with notice of the partner’s dissociation but without the partner’s consent, agrees to a material alteration in the nature or time of payment of a partnership obligation.”

The departing partner can also still bind the business for a time. Under Minn. Stat. § 323A.0702(a), “For two years after a partner dissociates without resulting in a dissolution and winding up of the partnership business,” the partnership is bound by the departed partner’s act only if the other party reasonably believed the person was still a partner and had no notice of the departure. The departed partner then owes the partnership for the resulting damage (subsection (b)). The departed partner can also be personally liable on the partnership’s own new transactions. Under Minn. Stat. § 323A.0703(b), a partner who leaves without a dissolution “is liable as a partner to the other party in a transaction entered into by the partnership, or a surviving partnership under sections 323A.0901 to 323A.0914, within two years after the partner’s dissociation, only if the partner is liable for the obligation under section 323A.0306” and the other party meets three conditions. At the time of the transaction, the other party reasonably believed the person was still a partner, did not have notice of the dissociation, and is not deemed to have knowledge or notice under the statute, including the deemed notice from a filed statement of dissociation.

A filing narrows that exposure. “A dissociated partner or the partnership may file a statement of dissociation stating the name of the partnership and that the partner is dissociated from the partnership” (Minn. Stat. § 323A.0704(a)). Under subsection (c), “For the purposes of sections 323A.0702(a)(3) and 323A.0703(b)(3), a person not a partner is deemed to have notice of the dissociation 90 days after the statement of dissociation is filed.” The filing goes to the Minnesota Secretary of State, and chapter 323A sets a filing fee of $135 for a filed document (Minn. Stat. § 323A.0101(5)). Under Minn. Stat. § 323A.0105, “A statement will be filed as a supplement to any limited liability partnership registration on file, or if no registration has been filed, as a supplement to any assumed name filing for the partnership,” and the filer must also make one of those filings if neither is on file. “A statement filed by a partnership must be executed by at least two partners,” and each individual who signs as or for a partner must personally declare under penalty of perjury that its contents are accurate. The filer “shall promptly send a copy of the statement to every nonfiling partner and to any other person named as a partner in the statement.” When the departure does not dissolve the partnership, I suggest that either side file the statement promptly and also tell the business’s regular vendors and lenders directly, because the deemed notice takes effect only after the statutory period runs.

When the departure dissolves the partnership, the winding-up sections govern instead. Under Minn. Stat. § 323A.0806(a), “Except as otherwise provided in subsection (b) and section 323A.0306, after dissolution a partner is liable to the other partners for the partner’s share of any partnership liability incurred under section 323A.0804.” The filing for that case is a statement of dissolution: under Minn. Stat. § 323A.0805(a), “After dissolution, a partner who has not wrongfully dissociated may file a statement of dissolution stating the name of the partnership and that the partnership has dissolved and is winding up its business.” Under subsection (c), “For the purposes of sections 323A.0301 and 323A.0804, a person not a partner is deemed to have notice of the dissolution and the limitation on the partners’ authority as a result of the statement of dissolution 90 days after it is filed.” Check the current text of § 323A.0805 before relying on that period.

When can a court expel a partner or dissolve the partnership?

A court can expel a partner, on application by the partnership or another partner, for wrongful conduct that adversely and materially affected the business, for willful or persistent material breach, or for conduct that makes it not reasonably practicable to carry on the business with that partner. A court can also dissolve the partnership on a partner’s application. The partnership agreement cannot remove either power.

The expulsion grounds in Minn. Stat. § 323A.0601(5) that fit a partner who has walked away include:

  1. The partner “engaged in wrongful conduct that adversely and materially affected the partnership business.”
  2. The partner “willfully or persistently committed a material breach of the partnership agreement or of a duty owed to the partnership or the other partners under section 323A.0404.”
  3. The partner “engaged in conduct relating to the partnership business which makes it not reasonably practicable to carry on the business in partnership with the partner.”

The dissolution route in Minn. Stat. § 323A.0801(5) parallels it: “on application by a partner, a judicial determination that” the business’s economic purpose is likely to be unreasonably frustrated, that “another partner has engaged in conduct relating to the partnership business which makes it not reasonably practicable to carry on the business in partnership with that partner,” or that it is otherwise not reasonably practicable to carry on the business under the agreement.

Under Minn. Stat. § 323A.0103(b), the partnership agreement may not “vary the right of a court to expel a partner in the events specified in section 323A.0601(5),” and may not “vary the requirement to wind up the partnership business in cases specified in section 323A.0801(4), (5), or (6).” The choice between the two remedies changes the outcome. Expulsion is a dissociation, so unless it leads to dissolution, the partnership continues and buys out the expelled partner under § 323A.0701. Dissolution sends the partnership into winding up: under Minn. Stat. § 323A.0802(a), “a partnership continues after dissolution only for the purpose of winding up its business,” unless all partners waive winding up under subsection (b). Under Minn. Stat. § 323A.0803(a), only “a partner who has not wrongfully dissociated may participate in winding up the partnership’s business.” In a partnership for a definite term or particular undertaking, a court’s expulsion of a partner before the term expires or the undertaking is completed is a wrongful dissociation under § 323A.0602(b)(2)(ii). That winding-up bar, the damages offset in § 323A.0701(c), and the payment deferral in subsection (h) then reach the expelled partner, unless a court finds under subsection (h) that earlier payment will not cause undue hardship to the business.

How are profits and work split while a partner is absent?

Until a partner dissociates, the statute’s default treats that partner the same as the partners doing the work. Under Minn. Stat. § 323A.0401(b), “Each partner is entitled to an equal share of the partnership profits,” and the partners who carry the extra load are not paid for it.

Subsection (h) provides that “A partner is not entitled to remuneration for services performed for the partnership, except for reasonable compensation for services rendered in winding up the business of the partnership.” Changing that arrangement takes everyone’s consent: “An act outside the ordinary course of business of a partnership and an amendment to the partnership agreement may be undertaken only with the consent of all of the partners” (subsection (j)). An absent partner who will not respond can therefore block an amendment that would pay the working partners.

These are defaults under § 323A.0103(a), so a written agreement that ties profit shares or pay to work performed controls instead. The accounts settle at the end. On winding up, “A partner shall contribute to the partnership an amount equal to any excess of the charges over the credits in the partner’s account but excluding from the calculation charges attributable to an obligation for which the partner is not personally liable under section 323A.0306” (Minn. Stat. § 323A.0807(b)). If a partner fails to contribute the full amount required, the other partners must make up the difference, in the proportions in which they share losses, for the obligations they are personally liable for (subsection (c)). I suggest keeping a dated record of who did the work and who paid what while the partner was gone, because those records support a damages claim or an offset against the buyout price.

How can a partnership agreement plan for a partner who leaves?

A written partnership agreement can define when a partner is treated as gone, require written notice, and make an early exit a breach. It cannot take away a partner’s power to leave or a court’s power to expel.

The statute leaves room for these terms:

  1. Agreed exit events. A partner is dissociated on “an event agreed to in the partnership agreement as causing the partner’s dissociation” (Minn. Stat. § 323A.0601(2)). The agreement can name events tied to absence, such as a stated period without participation, so the remaining partners need not argue about the partner’s intent.
  2. Written notice. The agreement may not “vary the power to dissociate as a partner under section 323A.0602(a), except to require the notice under section 323A.0601(1), to be in writing” (Minn. Stat. § 323A.0103(b)(6)).
  3. A commitment to stay. A departure is wrongful if “it is in breach of an express provision of the partnership agreement” (Minn. Stat. § 323A.0602(b)(1)), which brings the damages and offset rules into play.
  4. Continuation and price. Because the agreement governs to the extent it provides otherwise (§ 323A.0103(a)), it can let the remaining partners continue the business and set its own buyout price and payment terms in place of the statutory formula.
Can I treat my partner as gone if they just stopped showing up?

Not safely on silence alone. Under Minn. Stat. § 323A.0601(1), a partner is dissociated when the partnership has notice of the partner’s express will to withdraw, and absence is not one of the listed events. I suggest asking the partner to confirm in writing whether they are withdrawing, because a written answer fixes the date. If they will not answer and their conduct makes it not reasonably practicable to carry on the business with them, the partnership or another partner can ask a court to expel them under Minn. Stat. § 323A.0601(5).

Do I have to pay a partner who quit for their share?

Chapter 323A provides for payment either way, unless your partnership agreement provides otherwise under Minn. Stat. § 323A.0103(a). If the departure dissolves the partnership, as a withdrawal from a partnership at will does unless all partners waive winding up, Minn. Stat. § 323A.0807(b) entitles each partner to a settlement of all partnership accounts upon winding up, and the partnership makes a distribution to a partner equal to any excess of the credits over the charges in that partner’s account. If the departure does not dissolve the partnership, Minn. Stat. § 323A.0701(a) requires the partnership to buy the departing partner’s interest at the statutory buyout price. Under subsection (c), damages for a wrongful departure and all other amounts the partner owes the partnership are offset against that price. If no price is agreed within the statutory period after the departing partner’s written demand, subsection (e) requires the partnership to pay its own estimate in cash. Under subsection (h), a partner who wrongfully leaves a partnership for a definite term or particular undertaking early is not entitled to payment until the term ends or the undertaking is completed, unless a court finds earlier payment will not cause undue hardship to the business.

Can my former partner open a competing business?

Chapter 323A does not stop it once the partner has dissociated. Under Minn. Stat. § 323A.0603(b), the duty not to compete with the partnership terminates on dissociation. The partner’s other duties of loyalty and care continue only for matters arising and events occurring before dissociation, unless the partner takes part in winding up the business, so a business opportunity the partnership was pursuing before the departure can still be the subject of a claim. A written partnership agreement may add terms on competition, and their enforceability turns on Minn. Stat. § 181.988 as well as their language. That statute makes any covenant not to compete contained in a contract or agreement void and unenforceable, and it defines a covenant not to compete as an agreement between an employee and employer that restricts the employee, after termination of the employment, from performing the work the statute lists. It defines an employer to include a partnership and an employee as any individual who performs services for an employer. A covenant not to compete does not include a nondisclosure agreement, an agreement designed to protect trade secrets or confidential information, a nonsolicitation agreement, or an agreement restricting the ability to use client or contact lists or solicit customers of the employer. Under subdivision 2(c), a void covenant does not render void or unenforceable any other provisions in the same agreement. The statute also lets partners, upon or in anticipation of a dissolution of a partnership, agree not to carry on a similar business within a reasonable geographic area where the business has been transacted. It applies to contracts and agreements entered into on or after July 1, 2023.

Am I still liable for partnership debts after I leave?

Yes, for debts the partnership incurred before you dissociated, and in some cases for later ones. Minn. Stat. § 323A.0703(a) provides that dissociation does not of itself discharge liability for an obligation incurred before dissociation. Under subsection (b), if your departure did not dissolve the partnership, you can also be liable on a transaction the partnership enters into for a statutory period after you leave, on the conditions that subsection lists, including that the other party reasonably believed you were still a partner and did not have notice of your dissociation. In that case, you may be released by agreement with the creditor and the partners continuing the business under subsection (c), and you are released under subsection (d) if a creditor with notice of your dissociation, but without your consent, agrees to a material alteration in the nature or time of payment. If your departure dissolved the partnership, Minn. Stat. § 323A.0603(a) applies sections 323A.0801 to 323A.0807 instead, and under Minn. Stat. § 323A.0806(a), except as that subsection and section 323A.0306 otherwise provide, after dissolution a partner is liable to the other partners for the partner’s share of any partnership liability incurred under section 323A.0804. For the purposes of Minn. Stat. § 323A.0306, a contract obligation is incurred when the contract is entered into, and a later amendment, modification, extension, or renewal does not change that time. If the business buys your interest, Minn. Stat. § 323A.0701(d) requires it to indemnify you against partnership liabilities, except liabilities you create by acting for it after leaving. Obligations incurred while the partnership was a limited liability partnership are solely the partnership’s under Minn. Stat. § 323A.0306(c).

Can the partner who left still see the partnership's books?

Yes, for the time they were a partner. Minn. Stat. § 323A.0403(b) requires a partnership to give former partners and their agents and attorneys access to books and records pertaining to the period during which they were partners. The right covers inspecting and copying during ordinary business hours, and the partnership may charge a reasonable fee for the labor and material cost of copies. Those records are what a departing partner uses to check the partnership’s estimate of the buyout price.

What if our partnership never had a written agreement?

Then an oral or implied agreement among the partners still governs first, and chapter 323A’s default rules fill in what it does not cover. Minn. Stat. § 323A.0101(9) treats the partnership agreement as written, oral, or implied, and under Minn. Stat. § 323A.0103(a), except as subsection (b) provides, relations among the partners are governed by the partnership agreement; to the extent the partnership agreement does not otherwise provide, chapter 323A governs. If the partners never agreed to a definite term or particular undertaking, the business is a partnership at will under Minn. Stat. § 323A.0101(10). A partner’s withdrawal by express will is then wrongful only if it breaches an express provision of the agreement, and notice of that withdrawal dissolves the partnership under Minn. Stat. § 323A.0801(1) unless all partners waive winding up.

Deciding What to Do When a Partner Walks Away

Under chapter 323A, a partner dissociates from a Minnesota partnership on an event the statute lists, such as the partnership’s notice of the partner’s express will to withdraw, and absence alone is not one of those events. The consequences turn on how and when the partner left. The partner owes damages if the departure was wrongful, meaning it breached an express term or, in a partnership for a definite term or particular undertaking, came early in one of the ways the statute lists. A departing partner also remains answerable for breaches of the agreement or of a duty committed before leaving. In a partnership at will, a withdrawal dissolves the partnership unless all partners agree to continue. In a partnership for a definite term or particular undertaking, at least half of the remaining partners can dissolve it within the statutory period after a wrongful departure or another departure the statute lists, and a partnership agreement can name an event that results in winding up the business. When the departure does not dissolve the partnership, the partnership buys the departing partner’s interest, less what that partner owes. A departing partner stays liable for partnership debts incurred before leaving, unless the partnership was a limited liability partnership when it incurred them or, for a departure that does not dissolve the partnership, a release under § 323A.0703 applies. A partner who dissociates without resulting in a dissolution and winding up of the partnership business can also be liable on a later partnership transaction. That liability arises only on the conditions § 323A.0703(b) lists, including that the other party reasonably believed the person was still a partner and had no notice of the departure. When the departure dissolves the partnership, § 323A.0603(a) sends it to the winding-up sections instead, and § 323A.0806(a) makes each partner liable to the other partners for the partner’s share of any partnership liability incurred under § 323A.0804 after dissolution, subject to the exceptions it lists. Related disputes between owners are collected under Minnesota ownership disputes. If a partner has walked away from your business, email [email protected] with a brief description of the partnership and what has happened. I can tell you whether the departure looks wrongful under chapter 323A and whether the statute points toward a buyout or a dissolution.