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Bar Exam > Agency & Partnership > Flashcards

Agency & Partnership Flashcards

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1
Q

Warrant of authority

A

If A makes K w/o authority, K is binding but A is liable for damages resulting from breach

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2
Q

Apparent Authority

A

Turns on 3rd party’s reasonable and good faith beliefs *focus is on what P has said/done not what A says/does

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2
Q

Undisclosed P (effect)

A

3rd party can back out if: - A falsely rep’d that A was acting for himself - P or A knew 3rd party would not have entered into K

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2
Q

Partnership dissolution

A

W at will partnership Expiration of term M mutual consent E expulsion of a partner B bankruptcy A activities illegal D death

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3
Q

Accounting as of right

A
  1. Partner wrongfully excluded from partnership business 2. wrongfully excluded from possession/use of partnership property 3. Partnership agreement says so 4. another partner wrongfully obtains secret profits 5. just and reasonable under the circumstances
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4
Q

Transferring partnership rights

A
  • can transfer econ rights - NOT managerial or voting rights
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5
Q

Apparent authority factors

A
  1. past dealings btw P and A of which 3rd party is aware 2. Trade customs 3. Industry standards 4. P’s written statement of authority 5. Nature of transaction
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5
Q

Partnership Actual Authority

A

Ordinary business: actual authority exists Special business: actual authority does not exist! - assignment of property - disposition of the goodwill of partnership - action that would make partnership impossible - confess a judgment - claim or arbitration

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5
Q

Dissolution and partner liablity

A

Generally, dissolution does not absolve partners of liability, unless: 1. Dissolution due to - illegality - bankruptcy 2. Partner in question lacked even authority to wind up affairs

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7
Q

A capacity

A

minimal capacity = ability to consent to act on P’s behalf

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7
Q

Partnership (losses and profits)

A
  • each partner entitled to equal share of profits and losses
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8
Q

Terminating Agency

A
  • unilateral right - by P or A at any time - must provide notice
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8
Q

A’s duties to P

A
  1. duty of loyalty - cant use agent rel for personal gain - cannot usurp a biz opp - cannot compete w/ P during agency rel 2. duty of care - commensurate w/ skills - duty of notice
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8
Q

Partnership by Estoppel

A
  • some representative action that person is a partner - by the person or w/ her consent - reasonable reliance on the representation - damage as a result of reliance
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9
Q

Partner indemnificatoin

A

Partnership must indemnify partner if sued due to conduct in pursuit of partnership business

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10
Q

Continuing partnership after dissolution

A
  • If dissolution due to death or bankruptcy, remaining partners can agree to continue - disassociating partner is paid a fair share of her partnership stake
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12
Q

P capacity

A

Must have legal capacity to possess rights and incur responsibility - unincorporated orgs lack capacity

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13
Q

Partnership property

A
  • cannot unilaterally assign away partnership property - cannot use partnership property for personal benefit
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14
Q

LLP

A

Only available to licensed professionals - ease of partnership w/ protection of limited liability w/ the exception of tortious acts

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15
Q

Durable power of attorney

A
  • created in writing - intent to create durable power of atty
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15
Q

Agent K liability

A

only if P is undisclosed or partially-undisclosed

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16
Q

P tort liability for A’s acts

A
  1. Control (day-to-day) 2. Scope of employment - closely connected - common - history - frolic - foreseeability
17
Q

Partnership

A

Association of 2+ for purposes of carrying on a for-profit business as co-owners - specific intent not required - shared profit = prima facie proof

18
Q

Partnership (J&S)

A

If partnership has insufficient assets to pay debt, each partner is J&S liable

18
Q

Court ordered partnerhsip dissolution

A

BIG IPO - B: breaches of partnership agreement - I: incompetence declared - G: guilt of partner such that prejudicially effects partnership continuing - I: oncapable of fulfilling duties - P: profit no longer - O: other circumstances

18
Q

General vs. limited partners

A

Limited get - limited management rights - limited liability

19
Q

Partnership Accounting

A

All partners joined and court determines liabilities btw each partner and partnership as a whole. - partners normally not allowed to sue each other

20
Q

Binding the partnership

A

Each partner is an A of the partnership and can bind the partnership

21
Q

General partner in LP withdrawal as operation of law

A
  1. Assignment of partnership interest 2. Removal in accordance w/ pship agmt 3. Bankruptcy 4. Death/incompetency
22
Q

Ordinary vs special partnership decisions

A
  1. Ordinary - majority 2. Special - unanimous
24
Q

P’s duties to A

A
  • Deal fairly and in good faith - abide by K obligations - reasonable compensation - Indemnify A w/r/t losses incurred during scope fo employment
26
Q

Agent authority

A
  • Apparent - Actual - Inherent
28
Q

Factors of ratification

A
  • K of material facts - Comprehensive: all of the agmt not part - Timeliness - Capacity: to execute agmt
30
Q

Sub Agent dramz

A
  1. A must have authority from P 2. A is liable to P for A2’s acts 3. P liable for A2’s acts to same extent as would be liable for A1’s acts 4. A2 owes a duty of loyalty to A1 and P
31
Q

Consequences of partnership dissolution

A
  1. Deprives all partnerships of actual authority except for the limited purposes of WINDING UP 2. But apparent authority may persists . . . - If 3rd party does not know of dissolution - notice if advertised in paper or 90 days after filing statement of dissolution
33
Q

Agency termination by operation of law

A
  • death of P (automatically) - death of A (automatically) - P’s loss of capacity (date of adjudication) Dur - A’s breach of fid duty
34
Q

Authority to wind up affairs of partnership

A

All partners, except: - partner who was wrongfully disassociated - partner stripped of wind up authority

35
Q

Order of partnership asset distribution

A
  1. Outside debt 2. Inside debt 3. Residual is divided up amongst partners - first get capital contribution - left over is divided evenly
37
Q

Holding P liable when A acts w/o authority

A
  1. Ratification 2. Estoppel
38
Q

Inherent authority

A

catch-all –> usually when there is already a clear agency relationship

40
Q

Estoppel

A

3rd party believes that A is acting w/ authority not based on P’s actions but on P’s negligence in preventing the belief - reasonable - injustice

41
Q

Ratification

A

P approval of A’s actions after the fact - express or implied

42
Q

Non-partner petition for dissolution

A
  1. Econ rights 2. - term is up - at will
43
Q

Determining whether property is personal or partnership

A
  • use - improvements to property - similar in character to other p’ship prop - listed as a p’ship asset - who pays taxes
44
Q

Actual authority

A

A reasonably and in good-faith believes that he possesses the property 1. express 2. implied - general trade usage w/n industry - P’s acquiescence - emergency

45
Q

Exceptions to Partnership accounting

A
  1. Negligence action in tort 2. So discrete and unrelated to partnership
46
Q

New partner liability

A
  • only liable for acts post-joining except for capital contribution
47
Q

Sharing of profits rebuttal to partnership formation

A
  • pay off debt - interest on a loan - form of compensation to employee - goodwill payments from sale of a business - retirement bennies of deceased or former partner
48
Q

Terminating LP

A
  1. Dissolution event per p’ship agmt 2. Written consent of all partners 3. No more general partners 4. Judicial decree
50
Q

Auto Death termination exception

A
  • bank/customer - A of military P
51
Q

Creation

A
  1. P manifests assent that - A act on P’s behalf - A act subject to P’s control 2. A manifests assent to P
52
Q

Agency relationship by implication

A

Parties need not manifest assent to agency rel but only to control and serve

53
Q

When A has actual authority to delegate

A
  1. mere ministerial function 2. required to delegate to specialist under law 3. consisted w/ custom or usage in the industry 4. If impossible for A to perform, A must delegate to the extent necessary Terminating actual authority
54
Q

Partnership tort liability

A

P’ship is liable unless: - fraud/crime against p’ship - outside scope of partnership - criminal acts

Bar Exam (18 decks)

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