MEE - Agency

Question 1

Partnership Formation

Answer 1

When two or more people associate to carry on as co-owners a business for profit.
A person who receives a share of the profits from a business is presumed to be a partner.

Question 2

Partnership.

A partner is also an _______ of the Partnership.

Answer 2

an agent.

therefore, can bind the partnership to a contract for the purpose of the business.

Question 3

A partnership can be bound on a contract entered into by a partner with _____ or _______ authority.

Answer 3

A partnership can be bound on a contract entered into by a partner with actual or apparent authority.

Question 4

Partnership.

Actual Authority:

Answer 4

is an authority a partner reasonably believes he has based on his communications with the partnership.

Actual authority can be:
Express
Implied: though custom, necessity or prior acquiescence.

Question 5

Partnership.

Implied Authority:

Answer 5

• The act of any partner apparently carrying on in the ordinary course of the partnership business or
• Business of the kind carried out by the partnership

will bind the partnership UNLESS,
The partner had no authority AND
the third party knew that the partner lacked of authority

Question 6

Partnership.

Actual Authority, requires:

Answer 6

-Majority vote of the partners.

Question 7

And actual authority when enter into matters outside the ordinary course of business requires additionally:

Answer 7

Unanimous consent of all partners.

Question 8

Liability of the partners:

Answer 8

All partners are jointly severally liable on contracts entered into on behalf of the partnership.
And each partner is personally liable for the entire amount of such obligations