Chapter IV - Partners and Their Relations
Section 24
Section 24: cessation of partnership interest
Section 24 governs resignation and other cessation events, outward notice, past obligations and default financial entitlements.
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This article is for general information. Refer to the Limited Liability Partnership Act, 2008 official text for the official provisions. If you need professional advice for your situation, contact Bizeneed.
Statutory text
Bare law
(1) A person may cease to be a partner of a limited liability partnership in accordance with an agreement with the other partners or, in the absence of agreement with the other partners as to cessation of being a partner, by giving a notice in writing of not less than thirty days to the other partners of his intention to resign as partner.
(2) A person shall cease to be a partner of a limited liability partnership— (a) on his death or dissolution of the limited liability partnership; or (b) if he is declared to be of unsound mind by a competent court; or (c) if he has applied to be adjudged as an insolvent or declared as an insolvent.
(3) Where a person has ceased to be a partner of a limited liability partnership (hereinafter referred to as "former partner"), the former partner is to be regarded (in relation to any person dealing with the limited liability partnership) as still being a partner of the limited liability partnership unless— (a) the person has notice that the former partner has ceased to be a partner of the limited liability partnership; or (b) notice that the former partner has ceased to be a partner of the limited liability partnership has been delivered to the Registrar.
(4) The cessation of a partner from the limited liability partnership does not by itself discharge the partner from any obligation to the limited liability partnership or to the other partners or to any other person which he incurred while being a partner.
(5) Where a partner of a limited liability partnership ceases to be a partner, unless otherwise provided in the limited liability partnership agreement, the former partner or a person entitled to his share in consequence of the death or insolvency of the former partner, shall be entitled to receive from the limited liability partnership— (a) an amount equal to the capital contribution of the former partner actually made to the limited liability partnership; and (b) his right to share in the accumulated profits of the limited liability partnership, after the deduction of accumulated losses of the limited liability partnership, determined as at the date the former partner ceased to be a partner.
(6) A former partner or a person entitled to his share in consequence of the death or insolvency of the former partner shall not have any right to interfere in the management of the limited liability partnership.
Key takeaways
Core rule
Section 24 governs resignation and other cessation events, outward notice, past obligations and default financial entitlements.
Practical step
Check the agreement and cessation event
How the section operates
Section 24 governs resignation and other cessation events, outward notice, past obligations and default financial entitlements.
Practical steps
Check the agreement and cessation event; give the required written notice where applicable; notify the Registrar or counterparties; calculate amounts under the agreement or default rule.
Practical preparation
Review these items against the Act and LLP records.
- Check the agreement and cessation event
- Give the required written notice where applicable
- Notify the Registrar or counterparties
- Calculate amounts under the agreement or default rule.
Practical checklist
Do
- Check the agreement and cessation event
- Give the required written notice where applicable
- Notify the Registrar or counterparties
- Calculate amounts under the agreement or default rule.
Avoid
- Do not rely on an undocumented assumption about the statutory requirement.
Illustrative example
Hypothetical: cessation of partnership interest
Dawn LLP's partner resigns under a written 30 day notice, but a supplier is not told.
Step 1
Date the cessation
Step 2
Deliver notice to the Registrar or supplier
Step 3
Determine past obligations and the former partner's share.
Outcome
- The supplier may continue treating the former partner as a partner until it has notice or the Registrar receives the cessation notice.
Glossary
- former partner
- A person who has ceased to be a partner, subject to section 24's third-party notice rule.
Frequently asked questions
What does section 24 require?
Section 24 governs resignation and other cessation events, outward notice, past obligations and default financial entitlements.
What should the LLP check under section 24?
Check the agreement and cessation event; give the required written notice where applicable; notify the Registrar or counterparties; calculate amounts under the agreement or default rule.
Need help applying this provision to your situation?
Contact BizeneedLast updated 10 October 2026