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As a result of this, the assets and liabilities of the old partnership are consumed. Therefore, such a dissolution is commonly known as technical dissolution.
The dissolution of a partnership is the process during which the affairs of the partnership are wound up (where the ongoing nature of the partnership relation terminates).
8 Steps to Dissolving a Limited Partnership Examine Your Limited Partnership Agreement. ... Vote to Dissolve Your Limited Partnership. ... File Dissolution Papers. ... Publish Notice of Your Dissolution. ... Review Your Third-Party Contracts. ... Liquidate Your Assets and Settle Your Debts. ... Distribute Remaining Assets to Partners.
Reasons for dissolution of a partnership can include death of a partner, admission of a new partner, insolvency of an existing partner, early retirement of a partner, or expiry of a partnership period as mutually agreed upon by all partners.
There are three causes of dissolution: (1) by act of the partners?some dissociations do trigger dissolution; (2) by operation of law; or (3) by court order.
An example of the dissolution of a partnership can be when certain gambling activities are made illegal in some countries. Business partnerships that conduct such gambling activities are considered dissolved as their brand of gambling is no longer legal.