Partnership

Question 1

What is a partnership?

Answer 1

2 or more people
associating
to carry on a business for profit

Question 2

Contributing to create a GP

Answer 2

Contributing:

$
Services
Capital

(All evidence of a GP)

Question 3

Req’s for LP or LLP

Answer 3

Written
Signed certificate
Filed w/ the secretary of state

Question 4

Is the partnership liable?

Answer 4

The agents have to be acting w/ actual, apparent authority

Question 5

Express authority

Answer 5

Must be approved by a majority of the general partners

Question 6

Apparent authority

Answer 6

Did the action happen within the ordinary course of business?

Question 7

Matters outside ordinary partnership business

Answer 7

Need unanimous vote of partners, must be express

Question 8

Is each partner liable?

Answer 8

Each partner is liable for their own misconduct

*What type of partnership is it?

Question 9

General partnership

Answer 9

Personally, vicariously, severally liable for debts & obligations of the partnership

Question 10

Limited partnership

Answer 10

1 general partner
1 limited partner

*must file a certificate of formation w/ sec of state

gen partner is liable UNLESS limited partner is involved in managerial decisions

Question 11

Incoming partners

Answer 11

Not liable for debts put in place before

but any $ contributed can be used to satisfy a pre-existing debt

Question 12

Outgoing partners

Answer 12

Liable until they die unless:

Notice is given to all known & potential creditor’s of p’s withdrawal

Question 13

General partnership’s by estoppel

Answer 13

Can’t represent that a partnership exists to a third party and then deny that one exists

Question 14

Duties of a partner

Answer 14

Duty of care & loyalty
“Fiduciary duties”

Question 15

Duty of care

Answer 15

Must refrain from

1) Grossly negligent/reckless conduct

2) Intentional misconduct AND

3) knowing violation of law

Question 16

Duty of loyalty

Answer 16

Each P must

1) Act in good faith & fairly

2) refrain from competing w/ partnership within scope of business

usurping a business opp that belongs to the partnership

Question 17

Use of partnership property

Answer 17

1) On behalf of partnership

2) Carry on business of partnership

unless you get consent

Question 18

Transferability of P’s interest

Answer 18

Can transfer interests in profits/losses to a 3p

Question 19

What happens when interests are transferred

Answer 19

Doesn’t terminate partnership and doesn’t make 3p a partner

Question 20

Transferee becomes a partner

Answer 20

Upon unanimous agreement

Question 21

Dissolution

Answer 21

A material change in the partnership that will trigger the winding up phase

Question 22

Winding up phase

Answer 22

Period of time between dissolution and termination where the partner affairs are settled

Question 23

Dissolution is triggered

Answer 23

Court order
Operation of Law
Partner actions

Question 24

Partner actions under RUPAA

Answer 24

1) By agreement
2) At will

Question 25

By agreement

Answer 25

A partnership is terminated upon the occurrence of an event stated in the partnership agreement

Question 26

At will partnerships

Answer 26

A partner of an at will partnership can disassociate at any time

Question 27

Rescinded dissolution under RUPA

Answer 27

The remaining partners must all consent to continuing Dissociating P is entitled to a buyout

Question 28

To Do's during winding up phase

Answer 28

1) Partners are entitled to a salary 2) Continue to owe fiduciary duties 3) Liable to all K's made w authority unless notice given

Question 29

Priority of distribution

Answer 29

Creditors (outside, inside) Capital contributions Remaining profits/surplus equally absent an agreement