Ratification if partnership accepts benefit of an

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Ratification If partnership accepts benefit of an authorized transaction or fails to disavow it, the partnership has ratified the transaction Under the UPA, whatever one partner knows, the partnership is deemed to know Tort liability Partnership is liable for intentional and negligent torts of a partner in the ordinary course of business or when the partner is acting with actual authority. Paying Partnership Debts Personal liability Each partner is personally liable for the debts of the partnership Joint and several liability Creditor may sue the partners jointly as a group or separately as individuals Liability of Incoming Partners (MANDATORY) Partner is personally liable only for obligations blah blah blah Relationships among partners (not mandatory) Financial rights Partners share profits equally, unless agreed otherwise Partners share losses in the same ratio as profits Unless agreed otherwise, partners do not get additional pay for additional work All partnership property belongs to the partnership, not to an individual Partner can transfer the right to profits, but not membership in the partnership You can only bring a new partner by agreement of other partners Relationships among partners Management dutie 10
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Duty of care Duty of good faith and fair dealing Duty of loyalty Not compete with partnership Turn over any profit to partnership Terminating a partnership 1. Partnership at will a. Partners have not agreed in advance how long their partnership will last; any of them may leave at any time 2. Term partnership a. Partners have decided on a length of time or a particular task Rightful Dissociation Occurs when a partner quits When one or more partners dissociate, the partnership can either buy out the departing partners and continue business or terminate the partnership Partner always have the power to leave but may not have the right. Rightful Dissociation Partner in a partnership at will gives notice that he intends to withdraw Partner agrees in advance on events that will cause dissociation (term partnership) Partner dies or become incompetent Partner is expelled by the other partners Wrongful Dissociation Partner violates the partnership agreement Partner withdraws before end of the term Court expels a partner in term partnership due to harmful behavior Partner in a term partnership is bankrupt Ending a partnership business involves three steps dissolution Decision to end business; can be voluntary or automatic Winding up 12/4/2018 11
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  • Fall '14
  • JosiahShowalter
  • Corporation, Types of business entity, partner, partnership agreement, tax status of a partnership

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