Themis Essay 858 Flashcards
A partnership is an
association of two or more persons to carry on a for-profit business as co-owners.
An agreement is necessary to create a partnership, but the agreement
may be implied by the conduct of the parties even when they have not entered into a written or oral agreement.
An agreement is generally presumed to be a partnership when
there is a sharing of the profits from the business.
If there is no agreement or the agreement is silent as to the division of profits and losses, then
each partner is entitled to an equal share of the partnership profits and losses.
When a partnership agreement only addresses the division of partnership profits,
a partner is chargeable with a share of the partnership losses in proportion to his share of the profits.
A partner is an
agent of the partnership for its business purposes.
As an agent, the partner can
commit the partnership to binding contracts with third parties.
The type of partnership the partners formed determines:
(i) the status of the partnership; and (ii) the partners’ individual liability.
Formation of a limited partnership requires
filing a certificate of limited partnership with the state.
In a general partnership, a partner is
jointly and severally liable for all partnership obligations.
A partner has the power to
dissociate from a partnership at any time, even if the dissociation is wrongful.
A partnership at will is dissolved when
a partner chooses to dissociate from the partnership by giving notice of her withdrawal.
A partnership at will is an open-ended partnership that
does not have a fixed termination based on a period of time or particular undertaking.
Termination of a partnership is a two-step process:
(i) dissolution and (ii) winding up.
A partnership is not terminated until the partnership business is wound up, which
is a process that entails liquidating assets, paying off creditors, and distributing any remaining funds to the partners.
