2) Formation

Question 1

general partnership: def

Answer 1

(per CA statute): association of 2+ ppl to carry on, as co-owners, a business for profit (sharing profits/losses)

Question 2

“person” in partnership def

Answer 2

can be person or association or corporation

Question 3

general partnership: ways to form

Answer 3

1) expressly

2) implicitly

Question 4

general partnership: express formation

Answer 4

oral or written agreement to coown the business for profit

Question 5

general partnership NOT needed to form

Answer 5

subjective intent NOT needed. Filing NOT needed

Question 6

general partnership: implicit formation

Answer 6

by conduct, w/o express agreement

Question 7

general partnership – significance of sharing profits

Answer 7

sharing of profits is prima facie evidence that partnership exists

Question 8

sharing of profits: doesn’t count

Answer 8

paying a loan
collecting rent
earning salary or commission

EVEN if these are “paid out of profits”

Question 9

GP: profit sharing prima facie evidence: how to rebut

Answer 9

evidence that losses not also shared, or evidence that management of business not shared

Question 10

limited partnership: signal to analyze

Answer 10

a partner seeks to limit his personal liability

Question 11

limited partnership: formation reqs

Answer 11

1) partnership agreement
2) file certificate of LP with SOS, signed by all GPs
3) must have some LPs and some GPs
4) name

Question 12

limited partnership: name reqs

Answer 12

must include “limited partnership” or L.P. or LP

Question 13

limited partnership: effective date of formation

Answer 13

–date SOS files certificate, or
–later date specified in the certificate IF certificate specified a date not more than 3 mo after filing
(can never be before filing)

Question 14

failed attempt to form LP or LLP: result

Answer 14

likely a GP, analyze it

Question 15

LLP: threshhold requirements

Answer 15

1) partnership in which each partner is a licensed professional: lawyer, accountant, or architect

Question 16

converting to an LLP: rules

Answer 16

• -vote of partners holding majority interest (each votes %)

- -unless partnership agreement requires something different

Question 17

converting to an LLP: exception

Answer 17

LP cannot convert to LLP

Question 18

requirements to become an LLP

Answer 18

1) register w SOS, inc req’d fee

2) name reqs

Question 19

LLP name reqs

Answer 19

Registered LImited LIability Partnership
Limited LIability Partnership
LLP, L.L.P.
R.L.L.P., RLLP

Question 20

partnership: sharing of profits and losses, %

Answer 20

doesn’t have to be equal, but will be equal unless there’s a contrary agreement

Question 21

can opt out of most default rules but not

Answer 21

1) right to dissassociate
2) duty of loyalty / care
3) right to see the books