Contracts of Partnership
Contracts of Partnership
Contracts of Partnership
Personal liability – if the partnership is contractually bound, each partner has joint and several, unlimited personal liability.
Joint and Several Liability- a creditor may sue the partners jointly as a group or separately as individuals.
Authority to Bind Partnership- a partner who has actual authority (expresses or implied) or apparent may bind the partnership.
Actual Express Authority- authority set forth in the partnership agreement, in additional agreements among partners, or in decisions made by a majority of the partners regarding the ordinary business of the partnership.
Actual Implied Authority- authority that is reasonably deducted from the nature of the partnership, the terms of the partnership agreement, or the relations of the partners.
Apparent Authority- an act of a partner for apparently carrying on in the ordinary course the partnership business or business of the kind carried on by the partnership binds the partnership, so long as the person has no knowledge or notice of the lack of actual authority.
Partnership by Estoppel- imposes partnership duties and liabilities on a non partner who has either represented himself or consented to be represented himself or consented to be represented as a partner.
Torts and Crimes of Partnership
Torts- the partnership is liable for loss or injury caused by any wrongful act or omission or other actionable conduct of any partner while acting within the ordinary course of the business or with the authority of her copartners; the partners are jointly and severally liable.
Breach Of Trust – the partnership is liable if a partner is the course of the partnerships business or while acting with authority of the partnership breaches a trust by misapplying money or property entrusted by a third person; the partners are jointly and severally liable.
Crimes- a partner is not criminally liable for the crimes of her partners unless she authorized or participated in them.
Notice to a Partner
Binds Partnership- a partnership is bound by a partners knowledge, notice or receipt of a notification of a fact relating to the partnership.
Notice- a person has notice of a fact if the person (1) knows of it, (2) has received a notification of a fact relating to the partnership.
Liability of Incoming Partner
Antecedent Debts- the liability of an incoming partner for antecedent (predecessor) debts of the partnership is limited to her capital contribution.
Subsequent Debts- the liability of an incoming partner for subsequent debts of the partnership is unlimited.
DISSOCIATION AND DISSOULUTION OF GENRAL PARTNERSHIP UNDER THE RUPA
Disassociation- is the change in the relation of partners caused by any partners ceasing to be associated in carrying on of the business.
Term partnership- partnership for a specific term or particular undertaking.
Partnership at will- partnership in which the partners have not agreed to remain partners until the expiration of a definite term or the completion of a particular undertaking.
Wrongful Dissociation- a dissociation that breaches an express provision of the partnership agreement or in a term partnership if before the expiration or completion of the undertaking (1) the partner voluntarily withdraws by express will, (2) the partner is judicially expelled for misconduct (3) the partner becomes a debtor in bankruptcy or (4) the partner is an entity and is expelled or otherwise dissociated because its dissolution or termination was willful.
Rightful Disassociation- all other dissociations are rightful including the death of a partner in any partnership and the withdrawal of partnership at will.
Effects of Dissociation terminates dissociating partners right to participate in the management of the partnership business and duties to partnership.
Dissolution
Causes of Dissolution-
Dissolution by an Act of the Partners partnership at will: withdrawal of a partner; term partners: (1) the term ends (2) all partners express agree to dissolve, or (3) a partner s dissociation is caused by a partners death of incapacity, bankruptcy or similar financial