Partnerships Flashcards
How to admit new partners?
Consent of all existing partners
When is a partnership created
when two or more people agree to conduct a for-profit business as co-owners
Key test to ascertain whether an arrangement is a partnership
Sharing of profits from a business
In what six situations is an agreement to share profits not a business
When shared to pay: (1) debt; (2) interest or other loan charges; (3) rent; (4) Wages or other compensation to an employee or contractor; (5) goodwill payments steemming from the sale of the business; or (6) an annuity or other retirement or health benefit
how are losses shared when partnership agreement is silent?
In same proportion as profits
How are profits and losses shared when PA is silent on both
Each partner gets an equal share
When is a partner liable for the conduct of their partners?
When the partner is acting in the ordinary course of business
Partnership by Estoppel
When (1) there is an oral, written, or implied by conduct representation that a person is a partner in a Partnership, (2)the person makes or consents to the representation, (3) a third party reasonably relied on the representation, and (4) the third party suffered damages as a result of the reliance
Torts by Partners
Partners are always liable for their tortious acts.
The partnership is liable if the torts are committed in the ordinary course of the Partnership or with Partnership authority.
Liability of each partner in a partnership
Each partner and is jointly and severally liable for the obligations of the partnership
Partner iability in LLPs
an LLP partner is not personally liable as a partner for an LLP obligation, and is only personally liable for their own misconduct
Partner Liability in LPs
General partner still generally liable.
Limited partner liability limited to her capital contribution to the LP
