4. Liability to TP

Question 1

What is required for Partner’s actual authority?

Answer 1

Express

• Statement of authority filed with Secretary of State
• Partnership agreement
• Majority vote (ordinary course of business)
• Unanimous vote (NOT ordinary course of business)

Implied

• Communication with Partner
• Partner’s reasonable belief

Question 2

What is required for Partner’s apparent authority?

Answer 2

RUPA

1) Partner’s authority held out
2) Ordinary course of business/Of the kind

Question 3

What are the exceptions to Partner’s apparent authority?

Answer 3

NO authority

TP knowledge/notice

• Actual knowledge (NOT negligent)
• Delivered notice/TP’s attention

Question 4

What type of partners are liable?

Answer 4

Joint and severally liable partners

• Pre-existing liability
• Personal liability

Question 5

Are newly joined partners liable?

Answer 5

No

- But they can lose investment share in partnership to satisfy debt obligations

Question 6

Liability for partner’s acts

Answer 6

A partnership is liable for the loss or injury caused by a partner acting in the ordinary course of business, including contract (authority), tort (outside scope), or criminal acts (principal/associate).

Question 7

What may partners be liable for?

Answer 7

Entire partnership obligations

• Obtain contribution from co-partnersfor paying more than fair share
• Obtain indemnification from co-partners for paying whole obligation