Partnership

Question 1

Partnership Definition

Answer 1

A partnership is the association of two or more person to carry on as co-owners, a business for profit, whether or not the persons intend to form the partnership

Question 2

Profit Sharing

Answer 2

Profit sharing creates a presumption that a person is a partner, unless the profits were received in payment of debt, rent, wages, etc.

Question 3

Partnership Liability

Answer 3

In general, partners are jointly and severally liable for partnership debts and obligations. To collect from a partner personally, a party must first obtain a judgment

Question 4

Incoming Partner Liability

Answer 4

An incoming partner is not personally liable for the debts incurred prior to their joining the partnership

Question 5

Fiduciary Duties

Answer 5

Partners owe the partnership and other partners the duty of loyalty, the duty of care, and the duty to account.

Question 6

Dissolution

Answer 6

The dissolution of a partnership is the change in the relation of the partners. Once one partner disassociates, the partnership is dissolved and must be wound up. Notice must be given to prior creditors

Question 7

Creditor Claims Against Partner

Answer 7

If a creditor has a claim against a partner, they can obtain an interest in the partnership. This includes profits but not management or voting rights

Question 8

Creditor Claims Against Partnership

Answer 8

If a creditor has a claim against the partnership, they can try to collect from individual partners only after they have been served, and after first seeking satisfaction from the partnership

Question 9

Limited Liability Partnership

Answer 9

Must file a statement of qualification with the state. No partner is personally liable for the obligations of the partnership.

Question 10

Limited Partnership

Answer 10

A limited partnership is comprised of at least one general partner and at least one limited partner. Must file a statement of qualification with the state. Partners are limited to liability equivalent to their capital contributions

Question 11

Partnership Agency

Answer 11

Each partner is an agent of the partnership and can be bound by contracts if the agent had actual or apparent authority

Question 12

Partnership Actual Authority

Answer 12

To enter into agreements regarding matters within the ordinary course of business requires a majority partnership vote. To enter into agreements outside the ordinary course of business requires a unanimous partnership vote.

Question 13

Adoption

Answer 13

Generally, a child may not be adopted without consent from both biological parents. An unwed father who has never attempted to create a relationship with the child though will not have rights with respect to the adoption