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| Dissolution: priority |
- outside/inside creditors
- all capital contributions
- profits equally w/o agreement
* each partner must receive:
- loans, capital
- share of profits - losses |
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Robin Tue, 07 Jul 2009 16:46:22 GMT |
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| Dissolution: def. |
1+ general partner express will to dissolve |
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Robin Tue, 07 Jul 2009 16:46:22 GMT |
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| Partnerships: relations between partners |
- fiduciaries: give rise to accounting for profits
- partnership property rule: ONLY share of profits is liquid, transferable personal property
- w/o agreement: equal control, NO salary, equal profits, losses like profits |
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Robin Tue, 07 Jul 2009 16:46:22 GMT |
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| Partnerships: liabilities to third-parties |
- general partners liable for all partnership obligations
- estoppel: representers liable as if general partners
- limited partners + RLLP partners: limited liability |
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Robin Tue, 07 Jul 2009 16:46:22 GMT |
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| Partnership |
- NO general partnership formalities
- Def.: 2+ carrying on as co-owners a business for profit |
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Robin Tue, 07 Jul 2009 16:40:46 GMT |
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| Agency: duties Agent owes Principal |
- duty of care
- obedience
- duty of loyalty (damages + disgorge profits) |
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Robin Tue, 07 Jul 2009 16:40:46 GMT |
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| Agency: Principal's liability for Agent's contracts |
- actual express authority: oral (except land), revocable (unless durable)
- implied authority: necessity, custom, prior dealings
- apparent authority: Principal cloaks + third-party relied
- ratification: knowledge + acceptance of benefits
* authorized Agent: NOT liable UNLESS undisclosed Principal |
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Robin Tue, 07 Jul 2009 16:40:46 GMT |
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| Agency: Principal's liability for Agent's torts |
- assent, benefit, control + scope
- NO vicarious liability for IC torts
- intentional torts: generally outside scope |
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Robin Tue, 07 Jul 2009 16:40:46 GMT |
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| Priority of distribution |
- creditors (incl. non-partner trade creditors and all partners who loaned to partnership)
- capital contributions must be re-paid to partners
- w/o agreement, profits + surplus (if any) distributed equally
RULE: each partner must be repaid loans + capital contributions + share of profits - losses |
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Robin Tue, 07 Jul 2009 16:33:35 GMT |
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| Compensation & liability for winding-up |
compensation given
partnership's liability for winding-up:
- old business: partnership + individual general partners liable on all transactions entered into to wind-up old business w/ existing creditors
- new business: partnership + individual general partners still liable on new transactions during winding-up UNTIL actual notice of dissolution given to creditors OR 90 days after filing w/ state of Statement of Dissolution |
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Robin Tue, 07 Jul 2009 16:21:58 GMT |
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| Dissolution |
PROCESS, not fixed moment in time
w/o agreement about events that will dissolve the partnership, it is AUTOMATIC upon:
- notice of express will by 1 general partner
TERMINATION: the end
WINDING-UP: period between dissolution and termination in which remaining partners liquidate the partnership assets to satisfy creditors |
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Robin Tue, 07 Jul 2009 16:21:58 GMT |
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| Partner's share of profits/losses |
absent agreement:
- profits shared equally
- losses shared like profits |
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Robin Tue, 07 Jul 2009 16:13:37 GMT |
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| Partnership management |
absent AGREEMENT ABOUT CONTROL (i.e., NOT just about contribution, profits proportionality), equal control among partners
absent AGREEMENT ABOUT SALARY: NO salary, just profit-sharing (EXCEPT: compensation to wind-up the business) |
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Robin Tue, 07 Jul 2009 16:13:37 GMT |
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| Partners' rights in partnership property |
- specific partnership assets: non-transferable
- share of profits and surplus: PERSONAL property, therefore transferable to third party
- share in management: non-transferable
specific partnership assets vs. personal property test: whose money used to purchase property
(in sum: interest in partnership generally illiquid) |
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Robin Tue, 07 Jul 2009 16:05:17 GMT |
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| General partners |
FIDUCIARIES of each other and the partnership
- duty of LOYALTY: no self-dealing, usurpation of partnership opportunities, or secret profits
- remedy: ACTION FOR ACCOUNTING: partnership may recover losses caused by breach + breaching partner may disgorge profits |
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Robin Tue, 07 Jul 2009 15:58:14 GMT |
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| Partnerships vs. other unincorp. business organizations |
LIMITED PARTNERSHIP: 1+ general partner and 1+ limited partner; must file w/ state a Limited Partnership Certificate incl. names of all general partners
- general partners liable for all limited partnership obligations
- general partners may control the business
- limited partners NOT liable for limited partnership obligations but may NOT control w/o forfeiting limited liability status
REGISTERED LIMITED LIABILITY PARTNERSHIP: NO partner is liable for debts or obligations |
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Robin Tue, 07 Jul 2009 15:43:47 GMT |
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| General partnership liability by estoppel |
one who represents to a third-party that a general partnership exists IS liable as if a general partnership exists |
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Robin Tue, 07 Jul 2009 15:43:47 GMT |
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| General partners are personally liable for debts of partnership |
- incoming partners generally NOT liable for pre-existing debts, BUT: any money paid-in can be used to pay prior debts of the partnership
- dissociating (withdrawing) partners liable for future debts UNTIL actual notice of dissociation given to creditors OR 90 days after filing Notice of Dissociation w/ state |
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Robin Tue, 07 Jul 2009 15:28:16 GMT |
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| Liabilities of general partners to third-parties |
Agent principles apply:
- partners are Agents of partnership for carrying on usual business
- partnership is bound by torts committed by partners in scope of partnership business
- partnership is bound by contracts entered into by partners w/ authority |
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Robin Tue, 07 Jul 2009 15:28:16 GMT |
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| Partnership formation |
NO formalities to general partnership formation (no writing, filing, etc.)
DEF: assoc. of 2+ persons carrying on as co-owners for profit
contribution of money or services in exchange for a share of profits creates a presumption that a general partnership exists |
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Robin Tue, 07 Jul 2009 15:21:54 GMT |
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| Partnership issue areas |
- formation
- liabilities of partners to third-parties
- rights & liabilities btw partners
- dissolution |
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Robin Tue, 07 Jul 2009 15:16:44 GMT |
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| Agent's duties owed to Principal |
- exercise REASONABLE CARE
- obey reasonable INSTRUCTIONS (not lie or break law)
- LOYALTY:
--no self-dealing (benefit to self to detriment of Principal)
--no usurpation of Principal's opportunity
--no secret profits
REMEDIES: losses caused by Agent's breach + Agent may disgorge profits made |
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Robin Tue, 07 Jul 2009 15:15:27 GMT |
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| Undisclosed / partially disclosed Principal |
partial disclosure (only ID concealed)
&
undisclosed (fact of Principal concealed):
authorized Agent may still be liable at election of third-party |
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Robin Tue, 07 Jul 2009 15:09:47 GMT |
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| Un/authorized Agents entering into contracts |
personally liable for unauthorized contracts
NOT liable for authorized contracts (Principal is vicariously liable) |
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Robin Tue, 07 Jul 2009 15:09:47 GMT |
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| Ratification |
authority granted after contract entered into; Principal liable if:
- Principal has knowledge of all material facts
- Principal accepts benefits
EXCEPT ratification cannot alter terms |
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Robin Tue, 07 Jul 2009 15:09:47 GMT |
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| APPARENT AUTHORITY for Agent to enter contracts |
APPEARANCE of authority + third-party RELIANCE
- secret limiting instruction (limiting actual authority): liability still exists based on cloak of authority and third-party may rely
- lingering authority (actual authority has been terminated): liability still exists based on cloak of authority and third-party may rely |
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Robin Tue, 07 Jul 2009 15:09:47 GMT |
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| Actual IMPLIED AUTHORITY for Agent to enter contracts |
- all tasks NECESSARY to accomplish an expressly auth. task
- tasks perf. by CUSTOM by people w/ Agent's title/position
- tasks which Agent believes to be auth. to do from PRIOR DEALINGS btw Principal + Agent (Principal's acquiescence) |
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Robin Tue, 07 Jul 2009 14:41:03 GMT |
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| Actual EXPRESS AUTHORITY for Agent to enter contracts |
may be: oral, private, narrowly-tailored/interpreted
EXCEPTION: if contract itself must be in writing (then express authority must also be in writing--e.g., for land)
- revoked by: unilateral act by either party or death or incapacity of Principal
- cannot by revoked if Principal gives Durable Power of Attorney |
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Robin Tue, 07 Jul 2009 14:37:31 GMT |
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| Types of authority for Agent to enter into contracts |
ACTUAL EXPRESS
ACTUAL IMPLIED
APPARENT AUTHORITY |
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Robin Tue, 07 Jul 2009 14:38:50 GMT |
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| Liability of Principal for contracts entered into by Agent |
RULE: Principal liable for contracted entered into by Agent IF Principal authorized Agent |
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Robin Tue, 07 Jul 2009 14:37:31 GMT |
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| Vicarious liability for intentional torts |
RULE: generally outside scope of liability
EXCEPTIONS:
- authorized by Principal
- natural (w/in nature of employment)
- motivated by desire to serve Principal |
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Robin Tue, 07 Jul 2009 14:22:55 GMT |
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| Scope of Principal-Agent relationship factors |
- conduct w/in job description (YES)
- frolic (NO) vs. detour (YES)
- Agent intended any benefit to Principal (YES) |
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Robin Tue, 07 Jul 2009 14:18:17 GMT |
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| Agent vs. Independent Contractor |
FACTORS
- no right to control ICs b/c no power to supervise manner of performance
RULE
- no vicarious liability for IC's torts
EXCEPTION
- ultra-hazardous activities
- estoppel (you hold out IC w/ appearance of agency) |
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Robin Tue, 07 Jul 2009 14:05:28 GMT |
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| Agents |
SUB-AGENT
BORROWED AGENT
- no vicarious liability unless Principal has ASSENT, BENEFIT, ability to CONTROL Sub/Borrowed-Agent tortfeasor
- there is typically NO assent (only benefit) for Sub-Agent
- there is typically assent for Borrowed Agent |
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Robin Tue, 07 Jul 2009 13:59:58 GMT |
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| Liability of principal for torts of agent: respondeat superior / vicarious liability |
principal liable for agent's torts IF:
PRINCIPAL-AGENT RELATIONSHIP exists
- assent: informal agreement btw Principal w/ capacity + Agent
- benefit: Agent's conduct is for Principal's benefit
- control: Principal must have right to control Agent by having power to supervise the manner of Agent's performance
TORT COMMITTED W/IN SCOPE |
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Robin Tue, 07 Jul 2009 13:59:58 GMT |
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