Partnership

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apgiering
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159228
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Partnership
Updated:
2012-06-18 16:36:08
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  1. General partnership
    An association of two or more persons who are carrying on as co-owners of a business for profit.
  2. Do the principles of "agency" also apply to partnerships?
    Yes.
  3. When do partners act as agents of the partnership?
    For apparently carrying on usual partnership business.
  4. Is the general partnership liable for each partner's torts?
    Yes, if these torts were in the scope of partnership business and for each partner's authorized contracts.

    EXCEPTION: Incoming partners are not generally liable for prior debts, but any money paid in to the partnership by the partner can be used to satisfy those prior debts.
  5. Are incoming partners liable for prior debts of the pratnership?
    No, not generally, but any money paid in to the partnership by the partner can be used to satisfy thise prior debts.
  6. For how long does a disassociating partner retain liability for future debts of the partnership?
    • A notice of dissociation is given to creditors, or
    • 90 days after filing a Notice of Dissociation with the state
  7. Liability by estoppel
    One who represents to a third party that a general partnership exists will be liable as if a general partnership exists.
  8. Are partners fiduciaries of each other and the partnership?
    Yes.
  9. What duties due partners owe to the partnership?
    • Duty of loyalty (no self-dealing, usurpation or profit at the partnersihp's expense)
    • Action for Accounting -- Partnership can recover its losses caused by the breach and also may disgorge profits made by the breaching partner
  10. Action for Accounting
    Partnership can recover its losses caused by the breach of the duty of loyalty and also may disgorge profits made by the breaching partner.
  11. What are partners' rights in partnership property?
    • Specific partnership assets - none
    • Share of profits and surplus - personal property that is alienable
    • Share in management - a right to shrae but may not transfer
  12. What are partners' rights to specific partnership assets?
    None.
  13. What are partners' rights to a share of profits and surplus?
    They have rights to personal property that is alienable.
  14. What are partners' rights to a share in management?
    A right to share, but may not transfer.
  15. What are the defaults in a partnership?
    • Management - absent an agreement, each partner entitled to equal control
    • Salary - absent an agreement, partners get no salary
    • Profits - absent an agreement, profits are shared equally
    • Losses - absent an agreement, losses are shared like profits
  16. How do partners share management?
    Absent an agreement, each partner is entitled to equal control.
  17. What salary do partners get?
    Absent an agreement, partners get no salary.
  18. How are profits shared in a partnership?
    Absent an agreement, profits are shared equally.
  19. How are losses shared in a partnership?
    Absent an agreement, losses are shared like profits.
  20. Dissolution
    In the absence of an agreement that sets forth events of dissolution a genreal partnershi pdissolves upon notice of express will of just one general partner to dissociation.
  21. Termination
    The real end of the partnership.
  22. Winding up
    The period between dissolution and termination in which the remaining partners liquidate the partnership assets to satisfy the partnership's creditors.
  23. Partnership liability during winding up
    • Old business - The partnership and therefore its individual general partners retain liability on all transactions entered into to wind up old business with existing creditors
    • New business - The partnership and therefore its individual general partners retain liability on brand new business transactions during winding up until notice of dissolution is given to creditors or 90 days after filing a statement of dissolution wiht the state
  24. Partnership liability for old business during winding up
    The partnership and therefore its individual general partners retain liability on all transactions entered into to wind up old business with existing creditors
  25. Partnership liability for new business during winding up
    The partnership and therefore its individual generalĀ  partners retain liability on brand new business transactions during winding up until notice of dissolution is given to creditors or 90 days after filing a statement of dissolution wiht the state
  26. Priority of Distribution
    • First, all creditors must be paid
    • Second, all capital contributions by partners must be paid
    • Third, profits and surplus if any
  27. Limited partnership
    A partnership with at least one general partner and one limited partner.

    Must file with the state.
  28. Registered Limited Liability Partnership
    Must file a statement of Qualification and Annual Reports.

    No partner is liable for the debts and obligations of RLLPs.
  29. LLC (limited liability corporation)
    A hybrid between a corporation and a partnership in which owners, called members, have the same limited liability as shareholders of a corporation, as well as the benefits of partnership taxation.
  30. How do you form an LLC?
    File Articles of Organization and maybe an Operating Agreement.

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