Partnerships

Question 1

General Partnership Formation

Answer 1

“association of two or more legal persons intending to carry on as co-owners of a business for profit.”

Question 2

legal persons

Answer 2

individuals and business entities

Question 3

intent

Answer 3

-objective intent by words or conduct that the persons were carrying on as co-owners of a business for profit.
-the subjective intent to create a partnership is irrelevant.

Question 4

Factors of Partnership Formation

Answer 4

In order of importance
(1) the parties sharing of profits and losses (creates a rebuttable presumption of general partnership
(2) the parties having the right to participate in control of business
(3) title held in joint tenancy or in common
(4) parties designate their relationship as partnership
(5) extensive undertaking
(6) sharing gross returns

Question 5

Requirements for Formation

Answer 5

(1) meeting the definition
(2) writing requirement if for term of years

Question 6

Partnership by Estoppel

Answer 6

Parties may be liable to 3rd who rely on a representation of partnership.
Party liable if they hold themselves out as a partner.
Party liable if they expressly consent to being held out as partner.
Party not liable if another holds them out as a partner because they have no duty to deny and they must affirmatively consent.