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Business Law 2 > Test 1 > Flashcards

Test 1 Flashcards

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1
Q

Partnerships as a legal entity

A

Partnership having legal existence separate from their members. Ex. Opening a bank account under the business name not yours.

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2
Q

Types of partnerships for GP

A

Term - a partnership for only asp certain time

At Will- partner can end partnership at any time

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3
Q

Formation of a general partnership

A

Partnership agreement
Partnership capital
Partnership property
Partners interest in property

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4
Q

Partnership agreement for a GP

A

Preferable but not required to enter in a written agreement

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5
Q

Partnership capital

A

Total money contributed to be used by partnership

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6
Q

Partnership property

A

Sum of assets, including property acquired by the partnership

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7
Q

Partners interest in partnership

A

Profit of surplus owned by each individual partner, transferred as gift or sale.

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8
Q

Duties among partners

A

Fiduciary duty
Duty of obedience
Duty of care

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9
Q

Duties among partners

Fiduciary duty

A

Duty of loyalty, good faith , and honesty

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10
Q

Duties among partners

Duty of obedience

A

To obey partnership agreements and business decisions made by partners

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11
Q

Duties among partners

Duty of care

A

Manage partnership without negligence, reckless conduct(coming to work drunk), intentional misconduct(sexual harassment) and violation of law(lying for client).

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12
Q

Rights among partners

A

Rights In Partnership property
Transferable interest in partnership
Management

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13
Q

Rights in partnership property

A

Right to use partnership property for partnership purposes

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14
Q

Transferable interest in partnership

A

Right to share your surplus or profit. May be transferred Ex. Will

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15
Q

Management

A

Every partner has equal right in management, unless otherwise agreed.

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16
Q

Enforcing rights

The rights you have in the partnership

A

Information - right to demand information

Legal actions - right to sue partnership or partners

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17
Q

Contracts of partnership

Personal liability

A

Each partner has joint and several, unlimited personal liability

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18
Q

Contracts of partnership
Personal liability
Joint and several liability

A

The partnership may be sued joint as a group or individually to each person

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19
Q

Contracts of partnership
Personal liability
Unlimited personal liability

A

Can be sued for everything you own.

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20
Q

Summary equation of a general partnership

A

General partnership = unlimited power + unlimited liability

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21
Q

Contracts of partnership

Implied or apparent authorities

A

Actual express authority - partner was actually told orally or writing to enter contracts
Actual implied authority - deduced or concluded that the person can make decisions under companies name

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22
Q

Contracts of partnership

Partnership by estoppel

A

A non-partner presents himself as a partner, they are responsible for incurred debt. Ex. Taking out a loan for a company that you are not part of.

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23
Q

Tort

A

Partnership is responsible of any tort committed by partners during ordinary course of business

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24
Q

Crime

A

Partner is not considered criminally liable, for a crime committed unless participated or authorized.

25
Q

Notice to a partner

A

When one partner is notified, the entire firm is

26
Q

Liability of incoming partner

A

Antecedent debts

Subsequent debts

27
Q

Liability of incoming partner

Antecedent debts

A

Responsible for debts incurred before coming to the partnership but only for your capital contribution

28
Q

Liability of incoming partner

Subsequent debts

A

Has unlimited personal liability for debts incurred after being a partner.

29
Q

Dissociation

A

When a partner leaves the partnership

30
Q

Methods of dissociation for a general partnership (the ways a partner can leave the partnership)

A 
Partner withdraws 
Partner is judicially expelled 
Partner becomes bankrupt 
Partner dissolved it self within the company 
Death of a partner
31
Q

General rule of dissociation from a partnership

A

Dissociation may lead to dissolving unless the remaining partners agree to continue the business

32
Q

Dissolution

A

When the Gp is no longer operating as a business

33
Q

Winding up

A

Completing unfinished business

Tying up loose ends

34
Q

Distribution of assets for GP

A

Money owed to creditors (banks, light ill,landlord, ect.
Loans made by partners (loan you took from your father)
Capital contribution
Amount owned to profit

35
Q

Limited partnership

A

A partnership made under laws of state having one or more general partner and limited partner.

36
Q

Formation of a LP

A

Filing of certificates
Name
Contribution

37
Q

Filing of certificate

A

Two or more must file certificate signed with the state

38
Q

Name of LP

A

Inclusion of partners surname leads to loss of the limited partners limited liability.
So only the name of the GP should be included in the name and must end with L.P

39
Q

Contribution of formation for a LP

A

Cash, property, or services

40
Q

Rights of a L.P

Profit loss and sharing

A

Profits and losses are included in the partnership agreement
If not theN It will be based on the capital contribution of each partner

41
Q

Rights of a L.P

General partner

A

Unlimited power , unlimited personal liability

42
Q

Rights of a L.P

Limited partnership

A

Limited power, limited personal liability (extent of capital contribution)

43
Q

Dissolution of a LP

A

Expiration of time period
Withdrawal of general partner
A decree of judicial dissolution

44
Q

Winding up of a LP(same as GP)

Distribution of assets

A

Creditors including partners (so everybody gets paid)
Partners and ex-partners for distribution
Capital contribution
Partners for extra profit

45
Q

Limited liability companies equation

A

“The best of both worlds”

Unlimited power + limited liability

46
Q

Limited liability company

A

A non-corporate business that provides limited liability and participation in management. Considered a member

47
Q

Formation of a LLC

A

Filing - articles of organizations
Name must include LLC
Contribution - cash, property, services rendered

48
Q

Operating agreement for a LLC

A

Contract governing affairs and stating various right and duties of each member,

49
Q

Foreign limited liability company

A

An LLC is considered foreign other than in the state that where it was formed

50
Q

Financial rights of a LLC

Profits and loss sharing

A

Based on the % contribution

51
Q

Financial rights of a LLC

Distribution

A

Based on the % of members contribution

52
Q

Financial rights of a LLC

Withdrawal

A

When a person withdraws they may demand their capital contribution back.

53
Q

Dissolution of LLC

Will automatically dissolve upon

A

Dissociation of a member
Expiration
Written consent of all members
Decree of judicial dissolution

54
Q

Winding up for LLC

A

Creditors - all members
Unpaid distribution
Return of capital
Extra profit

55
Q

Limited liability partnership

A

General partnership that limits the liability of its partners

56
Q

Limited liability limited partnership

A

Limited partnership in which the liability of a GP is limited the same as an LLP

57
Q

Summary of partnership

Equations

A

GP = LLP
LP = LLLP
LLC

58
Q

General partnership

A

Two or more persons as co-owners for profit.

Business Law 2 (3 decks)

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