Section 54: Return of limited partner’s contribution
consolidated text (as at 2017, amended since). juris shows the text as it was consolidated; it does not confirm that this is the law in force today.
54. Return of limited partner’s contribution
(1) A limited partner shall not, whether during his term as partner or on
ceasing to be a partner, or at any time thereafter, or on dissolution of the
limited partnership or otherwise, receive any payment representing a return
of any part of his contribution to the limited partnership unless, at the time
of and immediately following the making of the payment, the limited partnership is certified by the general partner, or if more than one, by a majority of
the general partners, to be solvent.
(2) Where the limited partnership is insolvent at the time of or immediately following the making of the payment referred to in subsection (1), or in
the event of the insolvency of the limited partnership within a period of 6
months immediately following the time of the making of any such payment,
the payment shall, for a period of one year from the date of its receipt by the
partner, be repayable by him to the extent necessary to discharge any debt
of the limited partnership incurred at a time when his contribution formed
part of the assets of the limited partnership.
(3) Subject to subsections (1) and (2), a limited partner may demand the
return of his contribution—
(a) on the dissolution of the limited partnership; or
(b) at such time or upon the occurrence of such event as may be
specified in the partnership agreement.
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Limited Partnerships Act
(4) A partner may, notwithstanding the nature of his contribution, demand
and receive only money in return, unless—
(a) there is a statement to the contrary in the partnership agreement;
or
(b) all partners agree otherwise.
(5) A distribution of any asset of a limited partnership to a limited partner
shall be deemed to be a return of contribution for the purposes of subsection (1) to the extent that the distribution reduces the value of his share of
the assets of the partnership, calculated on the basis of the value of the net
assets of the limited partnership, below the value of the amount contributed
or agreed to be contributed by him.
(6) (a) Any reference in this section to the receipt by a partner of a payment shall include a reference to the release of any debt owed by him and
forming part of the assets of the limited partnership, including any obligation
on his part to make a contribution to the capital of the limited partnership.
(b) Any reference in subsection (2) to the making of a repayment by
a partner shall be deemed to include a reference to the due performance or
discharge by him of the debt or obligation.
(7) This section is subject to the provisions of section 60.
PART VII – DISSOLUTION OF LIMITED PARTNERSHIP