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An association of two or more persons to carry on as co-owners a business for profit.
No written or formal partnership agreement is necessary. Intent of parties controls; agreement to share profits raises a presumption of partnership.
Consentual relationship arises when principal authorizes agent to represent principal in business dealings with third parties, and the agent consents to do so.
- Can be created through estoppel where a third party reasonably relies on appearance of agency.
Binding actions on agency
- P is bound by A ks if actual or apparent authority.
- (1) management and other rights
- (2) right to share in partnership profits and losses and recieve distributions
Absent agreement otherwise, all partners have equal rights in the management of the partnership business.
- (1) titled in the partnership name
- (2) titled in the name of one or more partners and the instrument transffering title notes the title-holder's capacity as a partner of the existence of a partnership.
Presumped partnership prop if bought with partnership founds.
Intent unclear, look at factors: use, improvement of partnership, relationship to business, aquired in whose name, listed on partnership books.
All partners have equal right to use partnership property for partnership purposes.
Fidicuary duties (generally)
- good faith
- fair dealing
Duty of Loyalty (partnership)
- promote best interest of partnership
- Avoid secret profit
- disclose business opps, allow others to particpate
Duty of Care
- Avoid intentionaly misconduct and knowing violations
- Avoid grossly negligent or reckless conduct
Change of relationship of the partners cause by any partner ceasing to be associated in the carrying on of the business. Not necessarily cause a dissolution and winding up.
Marks point in time when one set of partnership relationship ends. A partnership is dissolved by the express will of any partner.
Joint and severally liable, and personally liable, but secondarily to the partnership.
LLC - Proper Formation
Proper certificate of formation must be filed with secretary of state
- Must list:
- LLC name
- Registers office
- principal place of business
- and purpose of the business
LLC - creation of management structure
Vesting power of management in manager.
- (1) have no management powers
- (2) are not agents for the entity
- (3) vote, according to their ownership percentage, only to elect or remove managers or to admit new memebers.