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partnership Flashcards

1
Q

def of partnership

A

a partnership is one type of business organisation commonly chosen by those who carry on a business with a view to profit. partnerships range from small organisations to lrg. some regulatory bodies require that their members operate through a partnership. others choose to operate as a partnership RAHTER THAN AN LLC

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2
Q

advantages of partnership to company

A

lack of formalities
the affairs of the partnership can remain private
the flexibility in running the partnership where partners may determine their own management and organisation

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3
Q

advantages of company to partnership

A

companies get securies much easier esp. floating charges.
ownership can be transferred much more easily through shares and there is no limit on the number of potential shareholders.
the obvious advantage of a company is limited liability. partners in a partnership have unlimited joint and severable liability for the devotes of partnership. this difference may be more illusory than real- it is common for directors of companies to be asked by banks ti provide personal guarantees. This negates the benefits of limited liabilty

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4
Q

s.1-4 partnership act 1890

A

the nature of parternship

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5
Q

s.5-18 partnership act 1890

A

the relations of partners to people dealing with the firm

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6
Q

s.19-31partnership act 1890

A

the relations if partners to one another

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7
Q

s.32-44partnership act 1890

A

the dissolution of partnership

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8
Q

s.1(1) partnership act 1890

A

partnership def= partnership is the relation which subsits between persons carrying on a business in COMMON view of profit
PERSONS=LEGAL PERSONAE (excluding incapax)
FIRM = Partnership
Choice of Name cannot be against CMPANY AND BUISNESS REG 2009

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9
Q

khan v miah

A

s.45partnership act 1890 business includes every trade occupation or profession.
the partnership must must be for the PURPOSE of carrying out a BUISNESS. Mere association for SOCIAL PURPOSE = NOT ENOUGH.

hELD no PASRTNERSHIP EXISTS WHERE THEY HAVE not REACHED THE STAGE OF carrying on a business!

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10
Q

worbey v campbell

A

court analyses facts to determine whether there is a partnership
mobile dating apps

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11
Q

the university court of the university of st Andrews v Talisman energy

A

partnerships joint ventures duty to disclose

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12
Q

pine energy consultants v talisman

A

there are certain features found in partnership: firm name/ partnership premise/ employees/ bank account/ no tax returns
Held the lack of one of above is not fatal to partnership existing but as there were none no Partnership existed.

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13
Q

s.2 partnership act 1890

A 
guidelines for persons in partnership
sharp v Carswell= guidline 1 Joint tenancy or ownership s.2(1)
clark v Jamison= guidline 2 SHARING GROSS RETURNS s.2(2)
dollar land (cumbernald) ltd v CTN properties= GUIDLINE 3= 2(3) reasons why share of profits = NO recipient of partner ie an employee awarded by a share of the profits
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14
Q

s.4(2) partnership act 1890

A

applies to scot only. the separate legal personality of a firm.this means that a partnership may own assets non its own right and those assets belong to partnership and not to individual patners.

ANY creditor suing a partner in his personal capacity may not carry out dil on partnership assets though creditor could carry out dil against partners own share in partnership

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15
Q

forsyth v hare &co

A

applies to scot only. the separate legal personality of a firm.
it is a quasi corp possessing many but not all the privileges which the law confers upon a duly constituted corp

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16
Q

sadler v whiteman

A

ENGLISH LAW a firm has no existence partners carry on business both as principals and as agents for watch other within the scope of the partnership. the firm name is mere expression NOT legal entity, IT is not correct to say that a firm carries on business the members of a firm carry on business in partnership under name or style of the firm

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17
Q

s.9 partnership act 1890

A

liability for a firms debts joint and severable

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18
Q

s.17(1) partnership act 1890

A

liability for incoming partner for prior acts of the firm. is not liable for any debts arsing before they were partner.
SIM V HOWAT

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19
Q

17(2)partnership act 1890

A

a retiring partner remains liable for his debts incurred with the firm during the period of partnership.
normally when a partner retires the terms of his retirement will clarify what he is liable for.

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20
Q

s. 36(1) partnership act 1890

A

where a partner has not properly notifies a third party of his retirement he may be still be left liable even if not partner.

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21
Q

welsh vknarston

A

EDINBURGH GAZETTE does serve as NOTICE of retirement to those who have not had dealings with the firm but not those who HAVE had dealings with the firm s. 36(1)/ 17(2)

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22
Q

s.5 partnership act 1890

A

agency of partners.
a partner may be limited by his partners as to the extent of his authority but his action willk be binding on the firm UNLESS
A) the person dealing with the partner KNOWS the partner LACKS AUTHORITY
B) the person did NOT know OR believe the partner is a PARTNER

23
Q

s.10 partnership act 1890

A

liabilities for wrongs. a partner acting in the ordinary course of business OR
A PARTNER ACTING WITH AUTHORITY OF HIS OTHER PARTNERS.
Latter = mair v wood when one partner injures another in the course of business as when one fisherman another with boathook NO VIACRIOUS LAIBILTY

24
Q

s.11 partnership act 1890

A

misappropriation of property. new mining and exploring syndicate ltd. v chalmers and hunter.

in each case apparently acting within the course of business partner receives money from third partner and misapplies it. the firm is liable for loss

25
Q

s.13 partnership act 1890

A

Misappropriation of property if an individual partner acting as trustee improperly misuses trust he alone = remains liable. though if another partner is aware of the breach then they may also be in breach. thus liable. the property itself is still recovable if in possession of the partnership .

26
Q

19-31 of the 1890 act

A

the absence of written contract Starrett v pia relations between partners themselves

27
Q

duties of partners

A

partners have fiduciary duties.

28
Q

s.28 partnership act 1890

A

duty of disclosure not only of the partnership financial affairs but all things affecting the partnership

29
Q

s.29 partnership act 1890

A

a partner is under a duty not to make a secret profit

30
Q

s.30 partnership act 1890

A

a partner is under a duty not to compete with the firm

31
Q

s.25 partnership act 1890

A

EXPULSION OF PARTNERS
no partner shall be expelled by mere majority of votes unless partnership agreement permits this
BLISSET V DANIEL

32
Q

FINLAYSON V TURNBULL

A

MANAGEMENT OF PARTNERSHIP AFFAIRS
partners are in fiduciary relationship with both partners and partnership they MUST act in GOODFAITH and with the BEST INTERESTS of the partnership at all time not using their position to take advantage

33
Q

S.24 partnership act 1890

A

RULES TO REGULATE THE INTEREST AND DUTIES OF THE PARTNERS.DONALDSON V WILLIAMSON

Presumptions:
financial equality
duty of indemnity
interest of advances
no payment of interest on capital before profits are ascertained
right to participate in management
no rem for acting in the partnership buisnesness
delectus personae
the right to vote and majority ruke
keeping of access to books and accounts
34
Q

partnership property

A

s.20 and s.21 PA partnernship property can be of any kind but just because it is property used by the partnership does not necessary mean that it is partnership prop ROBINSON V ASHTON

35
Q

retirement of partners under Partnership Agreement

A

reid v crabb
s.26
permits retirement at will unless agreement to the contrary

36
Q

dissolution of partnership with no judicial intervention

A

s.32-34

37
Q

s.41

A

ferguson v wilson RECISSON OF PARTNERSHIP AGREEMENT

38
Q

S.32

A

Dissolution by expiry of term

39
Q

s.33(1)

A

HILL V WHYLIE dissolution by death or bankrupcy

40
Q

s.34

A

dissolution by illegality

hugh stephenson

41
Q

dissolution of partnership agreement with judicial intervention

A

s.35

42
Q

s.35a

A

permanently unsound mind

43
Q

s.35b

A

permanently incapacity

44
Q

s.35c

A

prejudicial conduct

45
Q

s.35d

A

breach of a contract or where reasonably practicable for other partners to carry on partnership due to conduct of another partner
THOMSON PETITIONER

46
Q

s.35e

A

loss

47
Q

s.35f

A

just and equitable Sutherland v barnes

48
Q

consequences of dissolution

A

s.38boghani v nahoo no longer want to act in a partnership together hotels not finished at point of dissolution

development should be finished then sold. the completion of the transaction is necessary to wind up the affairs of the partnership. bring to end simply sold.

49
Q

s.39

A

partnership property can be dealt with for the purpose for the purpose of the partnership. every partner is entitled to his share of the property to pay debts any surplus may be split amongst the partners

50
Q

winding up and distribution of assets

A

re bourne: when a partner dies and a partnership comes to an end it is not only right but a DUTY of the surving partner to REALISE the assets for the purpose of winding up the partnership affairs including payment of partnership debts..
SIM VHOWAT

51
Q

1907 ltd partnership act

A

REFORMED! s.4(2)
certain info reg with reg of companies ss5 and 8A and 9
s.7 provides that a ltd partnership except where the 1907 act states otherwise.

52
Q

Management

A

1895 ACT has been REFORMED to reflect the changes. s.6
s.6.1 lited partner takes part in management he looses limited liabity and NO AUTHORITY TO BIND THE FIRM.
s.6.5.a ANY DIFFERENCE DECIDED BY MAJORITY.
S.6.5.b ltd partner with consent of the others assign share.
s.6.5.d a person can be introduced as a gen partner without consent of ltd partner
s.6.5.e a ltd partner is not entitled to dissolve partnership.
s.6.2 dissolution not caused by the death ect of the ltd partner. unless court decrees

53
Q

why reform

A

Scottish partnership was known for crim activity companies may be LP and have SEPERATE LEGAL PERSONALITY. Useful for hiding business ownership. increase in business ownership 300% most operating outwith UK information about people with significant control and Scottish partnerships regs(reg of people with significant control)- so no one who is not legally capax can be reg. launched

ALSO private fund ltd partnership reform order 2017- creates new types of ltd partnership available to private investment funds designed to reduce admin

buisness entities (5 decks)

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