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Reference - Partnership Disruption

Question 37

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Reference - Partnership Disruption. Bruce, Sandra, and Minnie want to form a partnership to assist students with resume preparation and employment searches. Bruce asks Sandra and Minnie if they should draw up some sort of agreement. Sandra replies that a written agreement is not legally required and that an oral agreement will set up a partnership. Upon the urging of Bruce and Minnie, however, Sandra agreed to a written agreement. Sandra has an opportunity to assist some students with resumes and does so without revealing her employment to the partnership. She keeps the funds she receives for herself. When Bruce and Minnie found out, Sandra replied that she was doing two-thirds of the partnership work; that she, therefore, had a majority of the voting rights; and that her actions were appropriate. The articles of partnership did not address the right to share in management, but Bruce and Minnie strongly disagreed with Sandra. Did Sandra commit any breach of duty to the partnership?


A) Yes, she breached her fiduciary duty to the other partners.
B) Yes, she breached her duty of obedience to the other partners.
C) Yes, but only if the other partners can show that she made more income through doing the work on her own than she would have made if she had done the work through the partnership.
D) Yes, but only if the other partners can show that they could have done a better job on the resumes than did Sandra.
E) No, she did not breach any duty.

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