Partnership Requirements

Question 1

Partnership Requirements

Answer 1

• 2 or more people, intend business, co-owners, for profit.
• Can arise without any agreement.
• “Person” is individual or entity, need capacity to contract.
• No writing required unless required by SoF.
• Presumption when intend to share profits
• Six Exceptions to Presumption. Receipt of money for payment: debts, wages or other compensation, rent, annuity (retirement or health benefits), interest related to loans, or goodwill payments.
• Joint venture is partnership for limited time and specific purpose.

Question 2

Purported Partner

Answer 2

• not a partner but treated as one for liability purposes.
• Requirements: Rep that person is partner; Rep by purported partner or w/ purported partner’s consent, Third party reasonably have relied on that rep; and third party suffered damages as a result of that reliance.
• If someone else makes rep by holding someone out as a partner w/o your consent no duty to deny rep doesn’t make person purported partner.
• If purported partner holds herself out or allows someone else to hold her out as a partner in a public manner, then purported partner will be liable to a third party who reasonably relies on that holding out even if don’t know 3rd person identity.
• When person rep that purported partner is in fact a partner, then partner is an agent of that person making the rep
• When partner in an existing partnership consents to the purported partners’ rep that she is a partner, then the purported partner becomes an agent of that partner.

Question 3

Nature of Partnership

Answer 3

• partner personally liable for debts and obligations of the partnership.
• All partner subject to liability.
• Partnership agreement rather than Partnership Act will govern actions.
• Agreement controls when conflict.