Nordic Townhomes Limited Partnership (Nordic) was established May 25, 1990. When Nordic was formed, it had three

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Nordic Townhomes Limited Partnership (Nordic) was established May 25, 1990. When Nordic was formed, it had three limited partners (Vincent Storland, Andrew Volstad, and Helge Nordby) and three general partners. As an entity, Nordic acquired, leased, and sold property.

When limited partner Vincent Storland died, his wife inherited his financial interest in Nordic. But she did not become a limited or general partner. In February 2005, Storland’s wife sold her interest in Nordic to Joel Storland, Janet Anderson, and Judy Rusten. Storland, Anderson, and Rusten have never been limited or general partners in Nordic. All the original limited partners are now deceased. Pursuant to the partnership agreement, once Nordic did not have any limited partners, the partnership was to dissolve, liquidate, and cease doing business.

Despite the fact that Nordic does not have any limited partners, it continued to exist as an entity and conduct business.

In August 2017, Storland, Anderson, and Rusten—who are not partners but hold a 33 percent ownership interest in Nordic—filed a complaint with the district court seeking an order directing Nordic to wind up business of the limited partnership, appoint a receiver to liquidate the assets of the partnership, and disburse any remaining balance to the interested parties. In response, Nordic filed a motion for summary judgment. Nordic alleged that respondents did not have standing to seek judicial or nonjudicial dissolution of the partnership because they are neither limited nor general partners. Respondents then filed a motion seeking summary judgment on the basis that the partnership agreement required dissolution and liquidation of Nordic.

The district court granted respondents’ motion for summary judgment and ordered that Nordic be dissolved. Nordic appealed. Should Storland, Anderson, and Rusten have any say in whether the partnership dissolves, even though they are not partners themselves? How should the court rule?

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Dynamic Business Law

ISBN: 9781260733976

6th Edition

Authors: Nancy Kubasek, M. Neil Browne, Daniel Herron, Lucien Dhooge, Linda Barkacs

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