Defendant United Counties Bank, a New Jersey banking corporation (United), among other motions in two related actions, moved to dismiss each on the grounds that plaintiff Irving Morris, receiver for 320 South Harrison Associates (Associates), a limited partnership organized under N.J.S.A. 42:2-1 et seq. , had no standing to sue because he was appointed receiver on the application of one of the limited partners for dissolution, and there was no provision in the Limited Partnership Act, N.J.S.A. 42:2-1 et seq. , for the appointment of a receiver.
In the first action wherein the receiver was appointed, he proceeded by an order to show cause, supported by certified statement, why United should not turn over to him certain bank accounts which stood in the name of Associates or the account balances whose funds came from an account which was in the name of Associates and transferred
to said other accounts and were not changed by other deposits.
In the second action the receiver, pursuant to a special order of the appointing court proceeded by separate plenary action both as receiver for Associates and as receiver for 320 South Harrison Corp., a New Jersey corporation, against United and others seeking to recover $97,500 rent security deposits placed in a savings account by Associates at Springfield State Bank, a New Jersey bank, and allegedly converted, and on a separate count for $100,000 obtained by United from purchasers of real estate from Associates prior to closing for discharging a $1,150,000 mortgage assigned to United by Springfield.
This opinion is limited to the power of the court to appoint a receiver for a limited partnership upon the application for dissolution of a limited partner, and the power of such a receiver to sue to recover assets and to sue to recover damages.
A court of equity has power to appoint a receiver of a partnership, see 3 Clark, Receivers (3 ed. 1959), § 911 et seq. Defendant's contention is that since no statute makes provision for the appointment of a receiver of a limited partnership, in contrast to the express statutory provision authorizing the appointment of a receiver for a limited partnership association, N.J.S.A. 42:3-19, the court is precluded from appointing a "statutory" receiver*fn1 and, inferably, any receiver, for the purpose of dissolving the partnership.
Although the statute pertaining to limited partnerships, N.J.S.A. 42:2-1 et seq. , does not make explicit provision for the appointment of a receiver upon the application of a limited partner, it does grant to a limited partner the
same right as a general partner to have dissolution and winding up by decree of court. N.J.S.A. 42:2-13 gives to a general partner of a limited partnership all the rights and powers of a general partner in a partnership without limited partners, subject to several exceptions not here relevant. N.J.S.A. 42:1-32(1) gives a partner of a partnership the power to apply for a judgment of dissolution for the grounds there stated. There is no question but such grounds exist in this matter. N.J.S.A. 42:4-1 et seq. provides for the dissolution of partnerships and states:
This article is remedial, provides additional remedies , and shall be liberally construed to effect its purpose, which is to permit the Superior Court speedily to dispose of actions involving dissolution of partnerships and the distribution of assets, and to prevent the acquisition of liens and preferences after the commencement of an action looking toward the distribution of the assets of a partnership amongst creditors. It shall not be so construed as to deprive the Superior Court of any of its existing jurisdiction. [Emphasis supplied]
N.J.S.A. 42:4-7 provides for the appointment of a receiver in connection with the dissolution of a partnership, "with a view to ultimate distribution amongst creditors ...