Agency / Partnership

Question 1

General Partnership

Answer 1

A GP is formed when 2 or more ppl associate to carry on a business for profit as co-owners; no written formalities req to form GP; subj intent of Ps to form GP also irrelevant.

General partners–have equal rights to manage the business and control its affairs; each personally and jointly and severally liable for the debts of the GP whether arising in tort or contract; no limited liability for GPs.

Profit sharing=presumption of GP and that ppl sharing the profits are partners.

Other factors that may evidence a partnership (but not presumption)–whether the Ps call themselves “partners” and the extent of business activities i.e. mgmt and control of business.

Question 2

Employee

Answer 2

Someone hired by employer to provide services to the employer regarding employer’s business.

Employee=agent of the employer (principal).

Evidence of employee-employer relationship–if employee paid fixed salary/wages and where employer has auth for managing details and method of how employees performs job.

Question 3

Contracts Entered into by Agents

Answer 3

A partnership is bound by the contracts entered into by its partners and employees (both of whom are considered agents) where such agents had actual authority, apparent authority or where the partnership ratifies the agreement.

Question 4

Actual Auth

Answer 4

Can be express or implied:

Express–the partnership expressly by words provides auth;

Implied–based on the manifestations (words/conduct) of the partnership the agent reasonably believes she poss auth.

Question 5

Apparent Auth

Answer 5

For agents–Exists where based on the manifestations of the partnership 3Ps reasonably the agent has auth to bind the partnership.
*E.g. agent having title “partner” on business card given to 3P

For partners–exists where the partner is acting w/in the scope of the partnership business, unless the partner lacked actual auth and the person knew or received notification of such.

Question 6

Ratification

Answer 6

Where the partnership agrees to the K after it has been entered into, either formally and expressly through a formal decision or impliedly by accepting the benefits of K.