Exam 41: Partnerships

Rundles, Kreiger, and Larson formed a partnership to breed and show horses. Rundles and Kreiger each contributed $25,000 to the partnership. Larson contributed four (4) horses valued at $25,000. The partnership agreement provided that the partners would share profits equally. When the horses failed to perform as expected, Rundles and Kreiger decided to reduce Larson's share of the profits. Larson claims that this decision must be unanimous to be binding. How will the case be decided?

In a partnership of four physicians, a decision to buy an office copier for the partnership must be approved by: ______.

A creditor of an individual partner cannot proceed against any specific items of partnership property, but can obtain a charging order against that partner's interest in the partnership.

A partner has the power to withdraw from the partnership at any time except: ______.

The assignee of a partner's interest in the partnership becomes a partner only with the consent of the other partners.

Partners hold title to firm property by:

Regarding partnership property:

Partners have the implied authority to bind the partnership by contracts of surety for any and all purposes.

Theo, a member of TGI partnership, withdrew from the partnership and duly notified the other members. The firm was an at-will partnership and the parties parted amicably, posting a notice in the local newspaper of the dissolution of their firm. Cosmo, a customer who had conducted business with Theo several times, did not see the newspaper notice and was not informed of the dissolution. Later, Theo approached Cosmo concerning a transaction similar to those Cosmo had engaged in before with Theo acting on behalf of TGI. Cosmo placed an order, gave a substantial down payment to Theo, and received a receipt on TGI stationery from him. Theo thereafter absconded with the down payment, and TGI failed to honor the contract. Cosmo sued the other members of TGI partnership. Discuss their potential liability.

A majority action of partners is not binding if it contravenes the partnership agreement.

A partnership involves equal contributions of capital, services, or a combination of these.

A partnership is not inferred when profits are received in payment of a debt.

All states except New York have adopted either the UPA or the RUPA. The Uniform Partnership Act, a codification of partnership law, has been adopted by 49 states.

All of the following transactions are prohibited by a by a partner without the consent of other partners except: ______.

A partner cannot make a general assignment of firm property for the benefit of creditors unless authorized by the other partners or unless they have abandoned the business.

All of the following result in the automatic dissolution of the partnership by law, except: ______.

A partner is an agent of the partnership and of the other partners.

In some instances, persons who are in fact not partners may be held liable to third persons as though they were partners.

Under the UPA, and absent an agreement, a tenancy in partnership possesses all the following characteristics, except:______.

When a partner executes an agreement outside the limitations of that partner's agreed scope of power, the other partners are always able to set aside the contract.