Chapter 10 - agency and partnership

Question 1

agency

Answer 1

service an agent provides

principal vicariously liable for agents acts

Question 2

agency relationship is created by

Answer 2

an express or implied contract
estoppel
ratification
necessity

Question 3

estoppel

Answer 3

prevents one person from contradicting an action or statement from the past

Question 4

ratification

Answer 4

principal can ratify a contract even if the agent acted beyonf both actual and apparent authority

Question 5

power of principal to raitfy

Answer 5

must be timely
agent must have been acting for a specific principal
principal must have been capacble of entering into the contract
parties must still be able yo perform the object of contract

Question 6

necessity

Answer 6

sale of deterioriting goods to preserve any value
spousal authority for the purchase of necessities

Question 7

agents duties

Answer 7

may be liable for acting beyond atuh
may be sued for breach of contract by principal
must perform functions set out in agreement
owes duty of reasonable care to principal
must not go against sepcific instructions
cannot delegate responsbiity without consent

Question 8

principals duties

Answer 8

must honour terms of contract
ambiguties regarding atuhority will be interpreted in favour of braoders agnts authority

Question 9

sole propietorship

Answer 9

individual carrying on business alone

must adhere to licensing and governing laws
unlimited liability for financial obligations

Question 10

partnership

Answer 10

two or more people carrying on business together for the purpose of making a profit

Question 11

corporation

Answer 11

a legal entity, separate from people who own and control it

Question 12

partnership act sets out circumstances that do not create a partnership

Answer 12

owning property in common
sharing gross returns from business activity
commission selling or profit sharing schemes
beneficiary of deceased partner receives share of profits
a loan is made in relation to a business and payment of interest varies with the profit

Question 13

a partnership is presumed

Answer 13

joint contribution of capital to est a business
intention to share expenses, profits, or losses
joint participation in the managment of a business

Question 14

dissolution of partnership

Answer 14

death, bankruptcy or insolvency of a partner
fixed term expiry of partnership
court

Question 15

advantages of partnerships

Answer 15

insurance coverage
reqs of unanimous consent protects partners
less expensive to form and oeprate than incorp
some tax advantages

Question 16

limited partners

Answer 16

liable only to the extent of their investment
- avoids the unlim liability that goes with being a general partner
- provides some of the advantages of incorps to partnerships

registration required

Question 17

limited liability partnership

Answer 17

be professionals auth by statute
maintain minimum insurance coverage
be registered with LLP in their name

partner not personally liable for acts or omissions of employees or other partners

Question 18

joint ventures

Answer 18

when two or more individuals or corps with to cooperate in completing a project together