TAYLOR BUILDING PRODUCTS, A/D/O GARLAND MANUFACTURING COMPANY, APPELLANT,
v.
FRED HENEFELD AND EILEEN HENEFELD, D/B/A H & K GARAGE DOORS, INC., APPELLEES
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A withdrawing partner remains liable to creditors under Florida law only if the creditor relied on the partnership's existence when extending credit; here, the trial court found no such reliance, so the withdrawing partner was not liable.
A withdrawing partner's continued liability to creditors depends on whether the creditor relied on the partnership's existence when extending credit.
[1] A withdrawing partner's liability to creditors for debts incurred after withdrawal requires proof that the creditor relied on the partnership's existence when extending c…
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Join FLexlaw to unlock all legal intelligence“the creditor must have relied upon the existence of the partnership and the resulting obligation of the partners”
Court explaining the requirement for withdrawing partner liability under section 620.73(1)(b)(1)
Taylor Building Products extended credit to a partnership operated by Fred and Eileen Henefeld after one partner had withdrawn, but the creditor had n…
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CAMPBELL, Judge.
This appeal poses the question of whether a withdrawing partner remains liable to creditors who, having previously extended credit to the partnership and having no knowledge of the partner’s withdrawal, extend credit to the partnership after the partner has withdrawn. While the law of Florida appears to answer that question in the affirmative (section 620.73, Florida Statutes (1985)), so that the withdrawing partner continues to be liable, we do not find it necessary to reach that issue. However, assuming that to be the law, the creditor must have relied upon the existence of the partnership and the resulting obligation of the partners. § 620.-73(l)(b)(l). That is a factual determination which has been decided here adversely to appellants. The creditor did not so rely.
In fact, it is not clear from the record just what kind of business entity the creditor believed the "partnership” was. The precise factual situation presented to the trial judge in this case was whether credit was extended to a partnership, a corporation or whether the creditor knew or cared what kind of business entity it was doing business with. There is substantial evidence in the record to support the finding of the trial judge.
Affirmed.
RYDER, A.C.J., and HALL, J., concur.