Removal or Resignation of Partner from LLP
The following points could be the reasons for removal or resignation of a partner:
- On death of the Partner
- On dissolution of the LLP
- If the Partner is declared to be of unsound mind
- If the Partner is adjusted as an insolvent or declared as insolvent.
Rights and Liabilities of Partner on Removal or Resignation:
- Any amount equal to the capital contribution of the former partner actually made.
- Rights to share in the profits after deducting losses (if any),decided as at the date the Partner is counted not to be a Partner anymore.
- On removal or resignation or cessation of a Partner in a LLP, whatever liability incurred while the person was a Partner in the LLP shall not be discharged and will continue.
- Removal of LLP Partner by Majority. When majority of partners want, they cannot remove a partner unless the agreement has such written powers. A Partner can be removed and Form 4 must be filed to effect the removal.