Exam 30: Formation and Internal Relations of General Partnerships

Ed, Vivian, and Pablo enter a partnership. Identify the source of the duties among the partners and whether these can be waived or varied. Name the principal duties Ed, Vivian, and Pablo have to each other and to the partnership.

In choosing the form in which to conduct business, if ease of formation is the primary concern, the owners would choose a:

A business form devised to avoid the burdens of corporate regulation, particularly the formerly widespread prohibition denying corporations the power to own and deal in real estate, and used primarily for asset securitization ventures is the:

Under the UPA, a partner's ownership interest in any specific item of partnership property is that of a tenant in partnership.

General partnerships are used frequently in finance, insurance, accounting, real estate, law, and other services.

Rosella, a general partner of Leafe and Thorne,  extends credit of $2,000 to a friend. This is  in violation of a specific agreement not to extend credit over $1,000 without the other partners' approval. Rosella will be held personally liable to the partners for any unpaid debt since she violated the duty of obedience.

Each partner, unless otherwise agreed, has equal rights in the management and conduct of the business of a general or a limited partnership.

A person who receives a share of profits of a business is presumed to be a partner.

A partner's fiduciary duty under the UPA differs in some respects from that under the RUPA.

A general partnership is formed without any formality and no documents need be filed with the state.

A partner can withdraw his partnership capital at any time.

Sole proprietorships today outnumber other unincorporated business associations.

Miller and Baker formed a partnership and purchased a cycle shop. The name of the new business cannot be "Miller Cycle Shop" because the name of the partnership must include the names of both partners if it includes the name of one partner.

John, George, and Ringo pool their money to buy land to operate an insect farm from which they plan to sell the insects for medicinal uses and share the profits or losses. Are they partners?

A partnership agreement should include all but which one of the following?

Anita is hired as head of the sales team of an unincorporated dress boutique solely owned by Betty. The two agree that Anita will receive one-third of the net profits, which amount is to be paid to her on a monthly basis. Is Anita a partner? If the boutique has a loss instead of a profit, would Anita have to share the loss? Explain.

A charitable organization cannot be formed as a partnership.

The UPA treats a partnership as a legal entity for all purposes.

A sole proprietorship dissolves upon the death of the owner.

Whether an individual partner or the partnership owns certain property determines who gets it upon dissolution of the partnership and who shares in income from it.