Exam 11: Agency and Partnership

"Partners must make clear in their partnership agreement any limitations on authority they wish to impose on each other when entering into contracts with outsiders." Discuss the accuracy of this statement.

Explain what is meant by an agent's "fiduciary duty" to the principal.

For a partnership to exist,something more than a single joint activity is required.

Discuss the extent of an agent's authority to bind a principal in dealings with a third party.

A sole proprietor is not only responsible for his own conduct but also for the wrongful conduct of any employee done in the course of employment.

Which of the following statements best describes a partnership?

An agent contracted with a third party on behalf of a principal,but went beyond both his actual and apparent authority.The third party was never paid.Which of the following indicates the legal position of the third party?

In certain cases,a third party can hold a principal to a contract even though the agent acted outside the authorization given him by his principal and even though his principal elected not to ratify the contract made by the agent.The third party can enforce the contract because of

Which one of the following is correct with respect to the rights of partners unless they have agreed otherwise?

In the modern economy,agency-by-necessity situations are becoming more commonplace.

Explain the limitations of the liability of partners for the acts of other partners.

"A partnership can be created by the conduct of the parties." Discuss the accuracy of this statement.

Joe is in the process of assembling land for Ace contractors Ltd.to build a supermarket.He entered into a contract with the seller Sam.He did not disclose that he was acting for someone else when he entered into the contract.Explain Sam's rights when the contract is breached and he learns that Joe was acting for Ace.

Q.N.S.Paper Co.v.Chartwell Shipping Ltd.involved an undisclosed principal situation.The Supreme Court had to determine whether the agent could be successfully sued.What did the Court find?

In which one of the following situations will a court find that a partnership exists?

Alison told her partners in writing that she would be leaving the law partnership at the current partnership year-end,January 31,2012.At year-end,Alison's partners bought her partnership interest and agreed that she would no longer be liable for any of the prior or subsequent partnership obligations.In February 2012,one of the remaining partners absconded with $2 million held for Mr.Smith,a long-time client,taken in trust in September 2011.Mr.Smith sued the partnership,the partners,and Alison.Given the foregoing facts,which of the following statements is false?

Joe and Mary promote several dances at school and split the profits.Will this be enough to establish a partnership?

When the object of the agency relationship becomes illegal,the agency agreement is frustrated and any authority terminated.

Frank asked Matt to join him in a business venture.Matt has heard that partnership could result in some harsh consequences.Which of the following statements he has heard about the liability of partners is false?