Agency and Partnership

Card Set Information

Author:
johncburt
ID:
198601
Filename:
Agency and Partnership
Updated:
2013-02-13 20:04:45
Tags:
Agency partnership
Folders:

Description:
Bar review
Show Answers:

Home > Flashcards > Print Preview

The flashcards below were created by user johncburt on FreezingBlue Flashcards. What would you like to do?


  1. Three Primary Agency Problems
    • 1. Liability of Principle to 3rd Parties for Torts of Agents
    • 2. Liability of Principle to 3rd parties for K entered by agent
    • 3. Duties which Agents owe to Principals
  2. Liability of Principal for Torts of Agent - 2 Part Test
    • Principle will be liable if:
    • 1. Principle/Agent Relationship
    • 2. Tort committed in Scope of relationship
  3. Liability of Principal for Torts of Agent - Principal/Agent Relationship Requires (3 Things - ABC)
    • 1. Assent: Must be an agreement
    • 2. Benefit: Agents conduct must be for Principals benefit
    • 3. Control: Principal must have the right to control the agent

    ** Liability of a sub-agent requires same 3 prongs (typically there is no right of control)
  4. Liability of Principal for Torts of Agent - Agents vs. Independent Contractors, what is the difference
    The key distinction is the right to control.  You can control your agent but cannot control an Independent Contractor and thus you are not vicariously liable for IC.
  5. Liability of Principal for Contracts entered by Agents - Authority (4 Types)
    • 1. Actual Express Authority
    • 2. Actual Implied
    • 3. Apparent
    • 4. Ratification
  6. Liability of Principal for Contracts entered by Agents - Authority - Actual Express - SOF
    Can be oral, but must be in writing if subject matter falls in SOF
  7. Liability of Principal for Contracts entered by Agents - Authority - Actual Express - How to Revoke
    • 1. Unilateral Act by either party to revoke
    • 2. On the death of the Principal - unless Durable Power of Attorney given. Otherwise, agent is liable for the K
  8. Liability of Principal for Contracts entered by Agents - Actual Implied Authority - 3 Situation
    • 1. Necessity: Implied authority to accomplish an expressly authorized task
    • 2. Custom: Implied that a person with a title or function has the right to K
    • 3. Prior dealings between P and A. P has accepted in the past
  9. Liability of Principal for Contracts entered by Agents - Apparent Authority
    When it appears to the buyer that A has the authority: like selling an item in a store even though the owner said not to sell it.
  10. Liability of Principal for Contracts entered by Agents - Ratification - Three requirements and barrel Ex
    • 1. P has knowledge of all material facts of K
    • 2. P accepts the benefits of the K
    • 3. CANNOT alter the terms of K or it is not ratification
    • Ex. P gave A authority to buy 10 steel drums but A bought wooden drums, P can accept or reject them all, but not a portion
  11. Duties Agent owes to Principal (3)
    • 1. Duty of Care
    • 2. Duty to obey instructions that are reasonable
    • 3. Duty of loyalty (no self-dealing). Principal can disgorge profits or breach of K claim
  12. Partnerships - Main Issue Areas (5)
    • 1. General Partnership Formation
    • 2. Liabilities of General partners to 3rd parties
    • 3. Rights and liabilities between GP's
    • 4. G Parnerships dissolution
    • 5. Alternative Unincorporated Business Organizations
  13. Partnerships - General Partnership Formation (3 points)
    • 1. No formalities
    • 2. Two or more people carrying on as co-owners of biz 4 profit
    • 3. Key Factor: a contribution of money or services in return for a share of profits is a presumption that a partnership exists
  14. Partnerships - Liability of GP's to 3rd parties
    Partners are agents of the partnership and each GP liable for the torts and K's of the partnership and other partners
  15. Partnerships - Liability of Incomming Partners
    New partners are not liable for prior debts but their contributions can be used to pay the debts
  16. Partnerships - Liability of DisAssociating Partners
    Liable on future debts of partnership until notice of disaccociation is given to creditors or 90-days after filing notice of dis-association w/ state
  17. Partnerships - Liability of GP's by Estoppel
    You will be held to the liabilities of a partnership if you represent you are part of the partnership even though you are not
  18. Rights and Liabilities Between Partners - Fiduciary Duty to Partners
    Duty of Loyalty: No self-dealing
  19. Rights and Liabilities Between Partners - What property can a Partner transfer
    • 1. Specific Assets: Land and equipment are owned by the partnership and cannot be sold by an individual partner
    • 2. Share of Profits: Profits are personable property, you can sell or assign your interest
  20. Rights and Liabilities Between Partners - Management and Salary
    • Absent an Agreement:
    • 1. Partners have equal Management - even if one owns more than the other
    • 2. There are no salaries, only profit share - except can get money for winding up

    ** Must be unanimous vote for dissolution or bulk asset sale
  21. Rights and Liabilities Between Partners - Partners share of Profits and Losses
    • Absent an Agreement:
    • 1. Profits are shared equally, no matter what percentage you own.
    • 2. Losses are shared the same proportion as the profits.
  22. General Partnership - Who can disolve partnership, potential liability consequences
    Any Partner can give notice to the other partners of his intent to dissolve the party.  Otherwise he can just disassociate from the partnership.

    **If a partner dissolves partnership early, he might be liable under breach of K so he may just want to disassociate rather than dissolve
  23. General Partnership - Dissolution vs. Termination
    • Dissolution is just the start of Winding Up.
    • Termination is when the partnership actually ceases.
  24. General Partnership - Dissolution - What is Winding Up
    Partners liquidate all partnership assets to pay creditors
  25. General Partnership - Dissolution - When Winding Up what is Partnership's liability
    • 1. Old Business: Partners remain liable on existing contracts
    • 2. New Business: Partners remain liable on any new business of any partner while winding up
  26. General Partnership - Dissolution - Priority of Distributions
    • 1. Outside Creditors paid first
    • 2. Inside Creditors paid 2nd
    • 3. Capital contributions MUST BE PAID
    • 4. Profits and surplus if any
  27. General Partnership - Dissolution - Priority of Distributions - What happens if not enough to pay back capital contributions
    Every partner must be paid back for loans and capital, so if there is not enough money to pay back then the individual partners need to pay in their own money
  28. Limited Partnerships - Formation (1) and who is liable once formed (2)
    • 1. File a LP Cert w/ SOS
    • 2. GP liable for all debts of partnership
    • 3. LP only liable up to their capital investment

    ** Modernly LP's can manage w/o losing their GP status

What would you like to do?

Home > Flashcards > Print Preview