Case Names

Question 1

Summers v. Dooley

Answer 1

Trash collectors case.

Rule: One partner could not unilaterally bind the business.

Question 2

Martin v. Peyton

Answer 2

A partnership with creditors.

Rule: Creditors were not partners because they had no agency

Question 3

Kessler v. Antinora

Answer 3

One partner provided money, the other labor.
Rule: where one partner contributes money to the venture and the other contributes services or labor, in the event of a loss neither party is liable to the other for any loss sustained.

Question 4

Meinhard v. Salmon

Answer 4

New lease without notifying his partner or including him.
Rule: partners, have a fiduciary duty to each other (which includes the duty of the finest loyalty), including sharing in any benefits that result from the parties’ joint venture.

Question 5

Roach v. Mead

Answer 5

One partner gave bad advice to a client.
Rule: A partner is jointly and severally liable for the tortious acts of another partner if he authorizes those acts or if the acts are committed in the ordinary course of the partnership’s business.

Question 6

Singer v. Singer

Answer 6

Partners bought land the partnership was considering.
Rule: A partner has a fiduciary duty not to compete with other partners, or with the partnership itself, in the absence of a partnership agreement stating otherwise.

Question 7

Enea v. Superior Court

Answer 7

partners renting partnership property to themselves at less than its fair market value.
Rule: The fiduciary duties imposed on partners by operation of law unquestionably bar them from conferring such benefits upon themselves at the partnership’s expense.

Question 8

Meehan v. Shaughnessy

Answer 8

Partners started a new firm but denied it.

Rule: A partner has a fiduciary duty to provide, on demand of another partner, true and complete information

Question 9

National Biscuit Company v. Stroud

Answer 9

One partner purchased bread over the objection of the other.

Rule: each party has the power to bind the partnership in matters pertaining to the partnership’s business.

Question 10

Rapoport v. 55 Perry Co.

Answer 10

assigned 10 percent of their partnership share to their two adult children
Rule: Partners can assign their right to profits but cannot unilaterally add new partners to the partnership.

Question 11

Collins v. Lewis

Answer 11

Dissolution of a term partnership.
Rule: A partner does not have a legal right to force dissolution of a partnership if the other partner fulfills his or her duties under the partnership agreement.

Question 12

Dreifuerst v. Dreifuerst

Answer 12

Brothers, some voted to dissolve the at will partnership.
Rule: partnership at will, a partnership which has no definite term or particular undertaking and can rightfully be dissolved by the express will of any partner.

Question 13

In Re USACafes

Answer 13

USACafes, Inc. is a limited partnership whose general partner was USACafes General Partner, Inc., a Delaware corporation.
Rule: the shareholders of the corporation owe fiduciary duties to both the partnership and corporation.

Question 14

Gateway Potato

Answer 14

Sunworth Packing Limited Partnership consisted of one general partner, Sunworth Corporation, and one limited partner, G.B. Investment Co.
Rule: A limited partner may be personally liable for partnership debts if the limited partner has performed substantially the same role as a general partner, even if the limited partner had no interaction with the creditor.

Question 15

Bane v. Ferguson

Answer 15

Retired partner could not get retirement benefits

Rule: A partnership has fiduciary duties to other partners, but not to former partners.

Question 16

Taghipour v. Jerez

Answer 16

Jerez obtained a loan on behalf of the LLC (even though the operating agreement said no).
Rule: When two statutory provisions cover the same subject and conflict in their operation, the provision that is more specific in application will govern

Question 17

Doral Dental

Answer 17

Marie Kasten, a member, made numerous requests to inspect company records.
Rule: A member may, upon reasonable request and at the member’s own expense, inspect and copy any company record

Question 18

St Alphonsus

Answer 18

St Alphonsus gave notice that it would dissociate from the partnership.
Rule: A dissociation is wrongful if it is in breach of an express provision of the partnership agreement.

Question 19

Kus v. Irving

Answer 19

Irving wronged a plaintiff. Were the other LLP partners liable?
Rule: A partner in a limited liability partnership is not liable for the obligations and liabilities of the partnership or the other partners.

Question 20

Bohatch

Answer 20

The partnership voted out Bohatch.
Rule: A partnership may expel a partner for purely business reasons, to protect relationships within the firm and with clients, or to resolve a fundamental schism in the partnership.

Question 21

Kaycee Land and Livestock v. Flahive

Answer 21

Flahive Oil & Gas’s use allegedly contaminated Kaycee’s property.
Rule: An aggrieved party may pierce the LLC veil in the same manner as it would pierce the corporate veil.

Question 22

Ederer v. Gursky

Answer 22

Pursuant to a withdrawal agreement, the LLP was obligated to pay Ederer (a partner).
Rule: Partners in a limited liability partnership are shielded from personal liability for partnership debts to third parties, but they are not protected from debts to other partners.

Question 23

VGS, Inc. v. Castiel

Answer 23

Sahagen convinced Quinn that Castiel could not run the LLC properly
Rule: Members of an LLC violate their duty of loyalty to a fellow member if they do not give him notice of an LLC action that is adverse to him

Question 24

Smith v. Kelley:

Answer 24

Smith was identified as a partner in a third-party contract and various other forms
Rule: A partnership by estoppel can be recognized as to third parties, but that pertains only to liability to the third party. Did not make him a partner

Question 25

Van Schaack Realty

Answer 25

Whether a sale or exchange occurs when a property owner conveys his property to an LLC in which he is a member.
Rule: A sale or exchange does not occur when a property owner conveys his property to a partnership or joint venture in which he is a member if he retains an ownership interest in the property.

Question 26

Pepsi-Cola Bottling Co. v. Handy

Answer 26

Handy knew of the contaminated land before forming the LLC and agreeing to sell to pepsi
Rule: A member of a limited liability company is protected against liability for claims arising solely by reason of being a member or acting as a manager of the company. Pepsi’s claims are based on fraudulent acts committed by the LLC members before the LLC was formed