Agency, Partnerships, Corporations and Secured Transactions

Question 1

To find principal liable under Respondeat Superior, must show that what exists?

Answer 1

Employer/Employee (Master/Servant) Relationship

If an Independant contractor, no liability for principal

Question 2

Major factor in determining whether independant contractor or employee?

Answer 2

Right to Control

Question 3

Factors in the right to control to consider

Answer 3

1. characterization of the parties
2. whether the business is distinct
3. local customs of work supervision
4. whose tools/facilities are being used
5. degree of skill required on the job
6. period of employment
7. basis of compensation
8. what the understanding of the parties is
9. whether the person was hired to further the principal’s business

Question 4

Authorized Subservants

Answer 4

Respondeat superior MAY carry with it either express or implied authorization to hire subservants

Question 5

Employer-Employee Estoppel

Answer 5

Can have respondeat superior where principal holds out to 3rd parties an employer-employee relationship for which 3rd party reasonably relies

Question 6

Barrowed Employees

Answer 6

Respondeat Superior depends on whether the principal has the primary right to control

Question 7

Principal will incur liability for independent contractors for:

Answer 7

1. inherently dangerous activities
2. non-delegable duties
3. principal knowingly hired a negligent contractor

Question 8

What is partnership capital and property?

Answer 8

Capital of the partnership is money contributed by each partner.

Prop of partnership is everything the partnership owns.

Question 9

Titled property is deemed partnership property if:

Answer 9

1. it is titled in the partnership name; or
2. titled in the name of a partner transfering the titleholder’s capacity as partner

Question 10

Property to be presumed by partnership property:

Answer 10

1. purchased by partnership property
2. use of property by the partnership
3. entry in partnership books
4. close relationship between the property and the business
5. improvement or maintanence with partnership funds

Question 11

Rights of Partner in Partnership Property

Answer 11

A partner is NOT a co-owner of partnership prop and thus has no transferable interest in it.

Question 12

Shareholder Quorum

Answer 12

Quromum is a majority of outstanding shares and cannot be broken once the meeting begins

Question 13

Cumilitive Voting for SH

Answer 13

Instead of 1 share 1 vote, articles may allow SH to vote a number equal to the number of voting shares he has multiplied by the number of directors to be elected.

Question 14

BoD Quorum

Answer 14

Majority of board unless bylaws or articles state otherwise. Directors can break quorum by withdrawing. Quorum can be no fewer than 1/3 of the board.

Question 15

Rule 10b-5 Makes it illegal to use commerce to:

Answer 15

1. employ any scheme to defraud
2. make an untrue statement of material fact
3. engage in fraud in connection with the purchase/sale of a security
4. Insider trading

Question 16

Tpper/Tippee liability under 10b-5

Answer 16

Tipper is liable if it was made for an improper purpose.

The tippee can be liable if the tipper breached a duty and knew the tipper was breaching those duties.

Question 17

Types of collateral

Answer 17

1. consumer goods
2. inventory
3. farm products
4. equipment

Question 18

Perfection for consumer goods

Answer 18

Automatic - as soon as there is attachment.

PMSI in a vehicle only perfects when noted on the certificate of title.

PMSI in a fixture will only have priority if PMSI holder files.

Question 19

Perfection by control only, only applies to

Answer 19

nonconsumer deposit accounts, electronic chattel paper and investment property

Question 20

Temporary perfection only valid for

Answer 20

20 days - 4 months if debtor transfers to another state

Question 21

What does 16(b) require

Answer 21

A surrender to the corporation of any short-swing profits realized within a 6-month period from the puchase/sale of any stock/equity by:

1. officer
2. director
3. SH of at least 10%

Question 22

What type of corporation does 16(b) apply to?

Answer 22

Publicly held corporations with more than $10 million in assets and at least 2000 SH or whose shares are traded on a national exchange.

Question 23

Transactions before becoming an officer/director under 16(b)

Answer 23

exempt

Question 24

Transactions after termination of being officer/director:

Answer 24

Exempt, unless w/in 6 months of termination

Question 25

Recoverable profit under 16(b)

Answer 25

highest sale price matched with lowest purchase price

Question 26

BJR

Answer 26

officers and directors of a corporation are immune from liability to the corporation for losses incurred in corporate transactions within their authority, so long as the transactions are made in good faith and with reasonable skill and prudence.

Question 27

Duty of Care

Answer 27

1. acted in good faith
2. with the care of an ordinary prudent person in like position
3. reasonably believe in best interest of the corp