Question 1

The only situation where an agent can be sued by a third party is where he has gone beyond his apparent and actual authority.

Accepted Answer

A) True 
 B)False

Question 2

Joe, Sam, and Harry set up an accounting partnership in a small town. Harry, to earn money on the side, did some accounting for friends at night, for which he received a fee. When Joe and Sam found out about this, they demanded that the fees received be paid into the partnership business. Explain the legal position of Harry.

Accepted Answer

Harry owes a fiduciary duty to the other

Question 3

When one partner dies, what happens to the partnership?

Accepted Answer

This depends on the jurisdiction and the

Question 4

Dennis, Sam, George, and Ray were partners in an accounting business, and Ray decided he wanted to retire. He sold his share of the partnership to Leonardo, but Leonardo is not a partner unless the other partners approve the change.

Accepted Answer

A) True 
 B)False

Question 5

Which of the following is incorrect with respect to the creation of a partnership?

Accepted Answer

A)  The business activity must be continuing in order for it to indicate the existence of a partnership. 
B)  The duties and obligations of partners to each other can be modified by agreement. 
C)  An important indication as to whether a partnership exists is the sharing of the profits of the business activity. 
D)  A partnership can only be created with the consent of the parties. 
E)  The common method of creating a partnership is by agreement. 
A)  The business activity must be continuing in order for it to indicate the existence of a partnership. 
B)  The duties and obligations of partners to each other can be modified by agreement. 
C)  An important indication as to whether a partnership exists is the sharing of the profits of the business activity. 
D)  A partnership can only be created with the consent of the parties. 
E)  The common method of creating a partnership is by agreement.

Question 6

A principal whose identity is concealed from the third parties with whom the agent is dealing is known s
an undisclosed principal.

Accepted Answer

A) True 
 B)False

Question 7

The unlimited liability of partners means that not only can they lose their entire investment in the business, but their personal assets are also at risk, such as their home and car.

Accepted Answer

A) True 
 B)False

Question 8

List three duties that an agent has to the principal.

Accepted Answer

To act in a reasonable manner with compe

Question 9

Which of the following is true in respect of limited liability partnerships (LLPs)?

Accepted Answer

A)  Historically, professionals have relied primarily on incorporation for carrying on business. 
B)  Professionals are prohibited from operating under a limited liability partnership. 
C)  The main advantage to those carrying on business as an LLP is that potential liability is limited for torts, for breach contract and for breach of trust. 
D)  Unlike limited partners, those operating through LLPs are not burdened with limitations with respect to naming, registration or other requirements. 
E)  Provincial limited liability partnership legislation has been introduced in various jurisdictions across Canada.
TRUE/FALSE. Write 'T' if the statement is true and 'F' if the statement is false. 
A)  Historically, professionals have relied primarily on incorporation for carrying on business. 
B)  Professionals are prohibited from operating under a limited liability partnership. 
C)  The main advantage to those carrying on business as an LLP is that potential liability is limited for torts, for breach contract and for breach of trust. 
D)  Unlike limited partners, those operating through LLPs are not burdened with limitations with respect to naming, registration or other requirements. 
E)  Provincial limited liability partnership legislation has been introduced in various jurisdictions across Canada.
TRUE/FALSE. Write 'T' if the statement is true and 'F' if the statement is false.

Question 10

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

Accepted Answer

This question simply requires students t

Question 11

Which of the following is incorrect with respect the responsibilities of partners to each other?

Accepted Answer

A)  Unless the partners have agreed otherwise, partners' expenses are to be reimbursed. 
B)  Partners are free to compete with the partnership providing they do it on their own time. 
C)  Unless the partners have agreed otherwise, profits and losses are shared equally. 
D)  Any information that one partner learns because of his position in the partnership must be used for the benefit of the partnership, not for personal use. 
E)  Each partner owes the other partners a fiduciary duty. 
A)  Unless the partners have agreed otherwise, partners' expenses are to be reimbursed. 
B)  Partners are free to compete with the partnership providing they do it on their own time. 
C)  Unless the partners have agreed otherwise, profits and losses are shared equally. 
D)  Any information that one partner learns because of his position in the partnership must be used for the benefit of the partnership, not for personal use. 
E)  Each partner owes the other partners a fiduciary duty.

Question 12

Which of the following is correct with respect to limited partnerships?

Accepted Answer

A)  Limited partnership refers to the fact that the partnership can only issue common shares. 
B)  Limited partnership refers to the fact that some partnerships are only created for a limited period of time. 
C)  Limited partnership refers to the fact that limited partnerships can only carry on in certain kinds of businesses. 
D)  Limited partnership refers to the fact that some partners have limited liability. 
E)  Limited partnership refers to the fact that no more than five people are allowed to be partners in such partnerships. 
A)  Limited partnership refers to the fact that the partnership can only issue common shares. 
B)  Limited partnership refers to the fact that some partnerships are only created for a limited period of time. 
C)  Limited partnership refers to the fact that limited partnerships can only carry on in certain kinds of businesses. 
D)  Limited partnership refers to the fact that some partners have limited liability. 
E)  Limited partnership refers to the fact that no more than five people are allowed to be partners in such partnerships.

Question 13

Any restrictions in the employment contract between principal and agent on an agent's authority will be binding on a third party.

Accepted Answer

A) True 
 B)False

Question 14

Information that comes to the agent because of his position as agent must be passed onto the third party.

Accepted Answer

A) True 
 B)False

Question 15

The biggest issue for a sole proprietor is unlimited liability.

Accepted Answer

A) True 
 B)False

Question 16

The partners can change the terms of their responsibilities to each other in the partnership agreement, but not in relationship to their obligations to third parties.

Accepted Answer

A) True 
 B)False

Question 17

Joe was a salesman, newly hired by Radio Hut. On his first day on the job, he was left in charge of the store while the manager and the other salesmen went to lunch. They specifically told him not to sell anything over $50 but to just tell the customer to come back in an hour when they would have returned. While they were at lunch, a customer came in and decided to purchase a new stereo TV set and several accessories. The total sales price was $1,600, and the customer couldn't wait. Joe sold her the merchandise at a $400 discount. When the customer returned the next day to pick up the goods, the manager refused to go through with the deal. Explain the manager's legal obligations in these circumstances.

Accepted Answer

Joe had apparent authority and

Question 18

A partnership cannot employ employees but must carry on its business through the partners.

Accepted Answer

A) True 
 B)False

Question 19

Explain what is meant by an agent's fiduciary duty. Give three examples of how that fiduciary duty can be breached.

Accepted Answer

Some examples from the text: must disclo

Question 20

Explain how the principle of fiduciary duty works in a partnership relationship.

Accepted Answer

It is very important that students under

The only situation where an agent can be sued by a third party is where he has gone beyond his apparent and actual authority.

When one partner dies, what happens to the partnership?

Dennis, Sam, George, and Ray were partners in an accounting business, and Ray decided he wanted to retire. He sold his share of the partnership to Leonardo, but Leonardo is not a partner unless the other partners approve the change.

Which of the following is incorrect with respect to the creation of a partnership?

A principal whose identity is concealed from the third parties with whom the agent is dealing is known s an undisclosed principal.

The unlimited liability of partners means that not only can they lose their entire investment in the business, but their personal assets are also at risk, such as their home and car.

List three duties that an agent has to the principal.

Which of the following is true in respect of limited liability partnerships (LLPs)?

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

Which of the following is incorrect with respect the responsibilities of partners to each other?

Which of the following is correct with respect to limited partnerships?

Any restrictions in the employment contract between principal and agent on an agent's authority will be binding on a third party.

Information that comes to the agent because of his position as agent must be passed onto the third party.

The biggest issue for a sole proprietor is unlimited liability.

The partners can change the terms of their responsibilities to each other in the partnership agreement, but not in relationship to their obligations to third parties.

A partnership cannot employ employees but must carry on its business through the partners.

Explain what is meant by an agent's fiduciary duty. Give three examples of how that fiduciary duty can be breached.

Explain how the principle of fiduciary duty works in a partnership relationship.

Managing Your Legal Affairs

Introduction to the Legal System

The Resolution of Disputes the Courts and Alternatives to Litigation

Intentional Torts

Negligence, Professional Liability, and Insurance Law

Formation of Contracts

Formation of Contracts Continued

Factors Affecting the Contractual Relationship

The End of the Contractual Relationship

Employment

Corporations

Real, Personal and Intellectual Property

Information Technology and the Internet

Sales and Consumer Protection

Priority of Creditors

Filters

Exam 11: Agency and Partnership

The only situation where an agent can be sued by a third party is where he has gone beyond his apparent and actual authority.

When one partner dies, what happens to the partnership?

Dennis, Sam, George, and Ray were partners in an accounting business, and Ray decided he wanted to retire. He sold his share of the partnership to Leonardo, but Leonardo is not a partner unless the other partners approve the change.

Which of the following is incorrect with respect to the creation of a partnership?

A principal whose identity is concealed from the third parties with whom the agent is dealing is known s an undisclosed principal.

The unlimited liability of partners means that not only can they lose their entire investment in the business, but their personal assets are also at risk, such as their home and car.

List three duties that an agent has to the principal.

Which of the following is true in respect of limited liability partnerships (LLPs)?

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

Which of the following is incorrect with respect the responsibilities of partners to each other?

Which of the following is correct with respect to limited partnerships?

Any restrictions in the employment contract between principal and agent on an agent's authority will be binding on a third party.

Information that comes to the agent because of his position as agent must be passed onto the third party.

The biggest issue for a sole proprietor is unlimited liability.

The partners can change the terms of their responsibilities to each other in the partnership agreement, but not in relationship to their obligations to third parties.

A partnership cannot employ employees but must carry on its business through the partners.

Explain what is meant by an agent's fiduciary duty. Give three examples of how that fiduciary duty can be breached.

Explain how the principle of fiduciary duty works in a partnership relationship.

Managing Your Legal Affairs

Introduction to the Legal System

The Resolution of Disputes the Courts and Alternatives to Litigation

Intentional Torts

Negligence, Professional Liability, and Insurance Law

Formation of Contracts

Formation of Contracts Continued

Factors Affecting the Contractual Relationship

The End of the Contractual Relationship

Employment

Corporations

Real, Personal and Intellectual Property

Information Technology and the Internet

Sales and Consumer Protection

Priority of Creditors

Filters