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Partnership Law Act 2019

Financial reporting, dissolution of partnership, and other miscellaneous provisions - End of partnership - Dissolving a partnership

79: Right of outgoing partner or partner’s estate to share profits or obtain interest

You could also call this:

"What happens to your share of the business if you leave or pass away"

Illustration for Partnership Law Act 2019

If you are a partner in a business and you die or leave the business, you or your estate have certain rights. You can choose to get a share of the profits made after you left, if the court decides those profits came from the part of the business you owned. Alternatively, you can choose to get interest on the amount of money that was yours in the business. The interest starts from the date you left the business and is calculated according to the rules in the Interest on Money Claims Act 2016. However, if you had an agreement that says something different, then this rule does not apply to you.

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This page was last updated on

View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=LMS206099.

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Part 4Financial reporting, dissolution of partnership, and other miscellaneous provisions
End of partnership: Dissolving a partnership

79Right of outgoing partner or partner’s estate to share profits or obtain interest

  1. This section and section 80 apply if—

  2. a member of a firm (A) dies or otherwise ceases to be a partner; and
    1. the surviving or continuing partners carry on the business of the firm with its capital or assets without any final settlement of accounts as between the firm and A or A’s estate.

      1. A or A’s estate is entitled, at the option of A or A’s personal representative, to—

      2. a share of the profits that are made after the dissolution of the partnership and that the court finds to be attributable to the use of A’s share of the partnership assets; or
        1. interest on the amount of A’s share of the partnership assets.

          1. The interest—

          2. is payable from the date of dissolution of the partnership; and
            1. must be calculated in accordance with Schedule 2 of the Interest on Money Claims Act 2016.

              1. Subsection (2) does not apply if there is an agreement to the contrary.

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              Notes
              • Section 79(2)(b): replaced, on , by section 154(1) of the Regulatory Systems (Economic Development) Amendment Act 2025 (2025 No 11).
              • Section 79(2A): inserted, on , by section 154(2) of the Regulatory Systems (Economic Development) Amendment Act 2025 (2025 No 11).