PARTNERSHIP Flashcards
PARTNERSHIP
A G_____ P______ is an ass_____ of two or more _____ who are c____ __ as co-____ of a _____ for profit.
PARTNERSHIP
A general partnership is an association of two or more persons who are carrying on as co-owners of a business for profit.
To determine whether G_____P_____ e_____, key ____ is parties’ _____. No _____ ______ req’d.
To determine whether General Partnership exists, key test is parties’ intent. No formal agreement req’d.
Intent to create a general partnership may be implied through
1) c______,
2) j______ t ______,
3) p_____ d______ as p_______,
4) c______ of_______, ________, _____ or ____ without c______ or w_____
will r____ _______.
Intent to create a general partnership may be implied through
1) conduct,
2) joint title to property,
3) parties’ designation as partnership,
4) contribution of money, property, services or labor without compensation or wages
will raise presumption.
Intent to create a general partnership may be implied through 1) C 2) JT 3) PD 4) C will RP
Intent to create a general partnership may be implied through
1) conduct,
2) joint title to property,
3) parties’ designation as partnership,
4) contribution of money, property, services or labor without compensation or wages
will raise presumption.
Profit sharing is key to prove existence of partnership.
Profit _____ is key to prove _____ of ______.
_____ sharing is ____to _____ existence of partnership. _____to create a _____ _____ may be _____.
Profit sharing is key to prove existence of partnership Intent to create a general partnership may be implied.
To determine whether GP exists,
1) parties’ ____. No _____ agreement ____.
2) Profit sharing is key to prove existence of partnership
3) New _____ requires ______ approval.
4) E_____: One who represents to ___ that___ ____ exists will be ____.
5) P_____: P_____ acquired by ___ ___is owned by ___ ___ and not the _____ _____ – not ____ t______.
6) D_____ Rules: W/o an _____, e____/v____, no ____, e_____ p____, and l____ like p_____. O____ _____ subject to ___ ___ ___.
To determine whether GP exists,
1) parties’ intent. No formal agreement req’d.
2) Profit sharing is key to prove existence of partnership
3) new partners requires unanimous approval.
4) Estoppel: One who represents to 3P that GP exists will be liable.
5) Property: Property acquired by GP is owned by GP and not the individual partners – not freely
6) Default Rules: W/o an agreement, equal control/vote, no salary, equal profits, and losses like profits. Oral partnerships subject to SOF.
Titled _property is ______ p_____ if t____ in _____ of p_____ or p_____ (and ____ on t____).
1) If _____ w/ p______ ____, __butt ____ _____ to be _____ ______.
2) O/w, __butt___ _____ to be s____, even if used for ______ _______.
Titled property is partnership property if titled in name of partnership or partner (and noted on title).
1) If purchased w/ partnership funds, rebuttably presumed to be partnership property.
2) O/w, rebuttably presumed to be separate, even if used for partnership purposes.
RIGHTS OF GP (absent agreement)
Management:
1) Partner’s entitled to Equal control.
2) Majority controls “Ordinary course of business” decisions
3). Unanimous consent of ALL partners for matters Outside of “Ordinary course of business”
PE= P____ E___
MO=M____ O___
UAOO= U____ A__ O ___ of O ____
RIGHTS OF GP (absent agreement)
Management:
1) partner’s entitled to equal control.
2) Majority controls “ordinary course of business” decisions
3). Unanimous consent of ALL partners for matters Outside of “ordinary course of business”
PE= Partner’s Equal
MO=Majority Ordinary
UAOO= Unanimous All Outside of ordinary
RIGHTS OF GP (absent agreement)
Distribution:
Each GP is entitled to share equally in profits and must contribute toward losses in proportion to profit share.
Profits may be validly assigned to an outsider.
RIGHTS OF GP (absent agreement)
Distribution:
Each GP is entitled to share equally in profits and must contribute toward losses in proportion to profit share.
Profits may be validly assigned to an outsider.
GP M\_\_\_\_\_\_\_\_\_\_\_\_\_\_ (A\_\_\_\_\_\_\_ A\_\_\_\_\_) PE= P\_\_\_\_ E\_\_\_ MO=M\_\_\_\_ O\_\_\_ UAOO= U\_\_\_\_ A\_\_ O \_\_\_ of O \_\_\_\_
RIGHTS OF GP MANAGEMENT (absent agreement)
PE= Partner’s Equal
MO=Majority Ordinary
UAOO= Unanimous All Outside of ordinary
RIGHTS OF GP (A___ A____)
Property:
1) P_____ p____ + s_____ in ______ =
Partnership Ass___/NOT T______.
2) P_____ + s_____ =
P____ P_____/T______.
RIGHTS OF GP (absent agreement)
Property:
1) Personal prop + share in management =
Partnership Assets/not transferrable.
2) Profits + surplus =
Personal Property/transferable.
DUTIES OF GP:
1) Duty of ___
2) Duty of ____ .
3) Duty of G____ ___ and ____ _____
4) Duty to K___ B____ _____ and ____and ____ to ______ partners.
DUTIES OF GP:
1) Duty of CARE
2) Duty of LOYALTY
3) Duty of GOOD FAITH AND FAIR DEALING
4) Duty to KEEP BOOKS ACCURATE and PRESENT to INTERESTED partners
DUTIES OF GP:
Duty of ____ not to engage in ____, ____, or un____ conduct or _____ m_____.
DUTIES OF GP:
Duty of care not to engage in negligent, reckless, or unlawful conduct or intentional misconduct
DUTIES OF GP:
Duty of loyalty breached when SUS:
(a) engaging in S_______: agent _____ b_____ to d______ of p______,
(b) U_____ the p______ a______, or
(c) Secret profits.
Remedies = _____ losses by _____ + ______ profits.
DUTIES OF GP:
Duty of loyalty breached when SUS:
(a) engaging in Self-dealing: agent receives benefit to detriment of principal,
(b) Usurping the principal’s authority, or
(c) Secret profits.
Remedies = recover losses by breach + disgorge profits.
Remedies when Duty of _____ is breached by __ ___ ___ = recover ____ by b____ + _____ p_____.
Remedies when Duty of Loyalty is breached by SUS = recover losses by breach + disgorge profits.
GENERAL PARTNERSHIP AUTHORITY
Each ____ is an____ of the partnership for the ____ of its ____, apply ____ concepts (r______)
GENERAL PARTNERSHIP AUTHORITY
Each partner is an agent of the partnership for the purpose of its business, apply agency concepts (ratification)
Apparent Authority:
A G____ P____ who acts in the “_____ course of the ______ business”, _____ the GP,
UNLESS at the ____ of the ______,
1) the general _____ did not have _____ to act in that ______ matter,
AND
2) the person with whom he is _____ _____ knew or had ______ that he _____ a______.
Apparent Authority:
A General Partner who acts in the “ordinary course of the partnership’s business”, binds the GP,
UNLESS at the time of contract,
1) the general partner did not have authority to act in that particular matter,
AND
2) the person with whom he is dealing actually knew or had notification that he lacked authority.
OCB =
OCB = Ordinary Course of Business
GP b_____ by a p_____ act if the p____ has ____ a_____, which can come from ____ a_____ (____ or all) or p_____ r____ b____ he has a_____ based on ______w/ other GP’s.
GP bound by a partner’s act if the partner has actual authority, which can come from express agreement (majority or all) or partner’s reasonable belief he has authority based on communications w/ other GP’s.
???DISSOCIATION AND DISSOLUTION (DISC/DISL)
A GP has the ____ to d___ or d_____ at ___ t____ by:
1) express will,
2) agreed event,
3) event that makes continuation unlawful,
4) expulsion (unanimous vote),
5) BK, ?????
6) death or incapacity, or
7) judicial order.
?????DISSOCIATION AND DISSOLUTION (DISC/DISL)
A GP has the power to dissociate or dissolve at any time by
1) express will,
2) agreed event,
3) event that makes continuation unlawful,
4) expulsion (unanimous vote),
5) BK, ?????
6) death or incapacity, or
7) judicial order.
Dissolution of GP
____ the _____ b_____ be ____ ___ before t ______.
Dissolution of GP
requires the partnership business be wound up before termination.
Dissolution of GP
P____ may _____ d______ by ______ vote of p_____ who have ____ w_____ dissolved.
Dissolution of GP
Partners may waive dissolution by unanimous vote of partners who have not wrongfully dissolved.
Dissolution of GP
_____ partner ____ receive their ____ and ____ _____ + share of ____, less ____ of ____.
Dissolution of GP
Each partner must receive their loans and capital contributions + share of profits, less share of losses
