Exam 37: Partnerships and Limited Liability Partnerships

In a limited partnership,a limited partner has full responsibility for the partnership and for all its debts.

A partner who pursues his or her own interests automatically violates the partner's fiduciary duties to the partnership.

In a general partnership,all partners have equal rights in managing the partnership.

In a limited liability limited partnership,the liability of a general partner is limited to the amount of capital he or she has invested in the partnership.

Corbin,a partner in Doctors Medical Clinic,applies for a loan with Evermore Bank allegedly on Doctors' behalf but without the authorization of the other partners.Evermore knows that Corbin is not authorized to take out the loan.Corbin defaults on the loan.Liability for its unpaid amount is imposed on

Fern and Gray want to form a limited partnership to manage two restaurants: Café Latte and Deli Delite.In most states,a limited partnership will be created when

In a limited partnership,with the exception of the right to participate in management,limited partners have essentially the same rights as general partners.

A partner owes to the partnership and the other partners a duty of loyalty.

Energy Unlimited,LP,is a limited partnership to which its partners,in?cluding Fink,have contributed capital.Energy's creditors include Graves Engineering,Inc.On Energy's dissolution,its assets will be distributed to pay

Kelly,Lars,and Mona agree to be partners in Neighborhood Delivery Service (NDS),splitting the profits equally.Kelly contributes 67 percent of the capital.When NDS is dissolved,its liabilities are greater than its assets.The losses are paid by

Lucy is a limited partner in Metro Contractors,a limited partnership,which cannot pay its debts.Lucy is personally liable for the debts

Noah and Orin do business as Pest Control Partners.In most states,for the purposes of suing and being sued,Pest Control Partners would be treated as

Fact Pattern 37-2A (Questions A9-A10 apply) Luann and Mace are partners in Networx,a computer peripherals firm. -Refer to Fact Pattern 37-2A.Mace dissociates from Networx.Luann signs a con?tract with Physik Drives,a wholesale component supplier,apparently on Networx's behalf.Physik does not know of Mace's dissociation.The contract is binding on

The Uniform Partnership Act governs the operation of partnerships.

A partner always has the power and the right to dissociate from the partnership.

A limited liability partnership allows its partners to avoid personal liability for the malpractice of other partners.

Hud and Iggy form Jerry-Bilt Construction to enter into a contract to build one bridge.Under their partnership agreement,Jerry-Bilt is to dissolve when the bridge is built.Iggy signs a contract for the firm to build a second bridge.Jerry-Bilt

Under no circumstances can a non-partner be regarded as an agent whose acts are binding on the partnership.

Fact Pattern 37-2A (Questions A9-A10 apply) Luann and Mace are partners in Networx,a computer peripherals firm. -Refer to Fact Pattern 37-2A.Luann signs a contract with Oleo Chips,a retail component supplier,apparently on Networx's behalf.The contract is binding on

On a partner's dissociation,his or her duty of loyalty to the partnership ends.