Partnership 2 Flashcards
(20 cards)
Can partnerships exist without a written agreement?
Yes
What does ‘joint and several liability’ mean for partners?
Each partner is individually and collectively responsible for all debts.
What happens to a partner’s share upon death?
It passes to their estate
Is registration required to form a general partnership?
No
What is a ‘sleeping partner’?
A partner who invests capital but does not take part in day-to-day management.
Can a minor be a partner?
Not in a legal sense
What is the effect of a partner’s bankruptcy on the partnership?
It generally results in automatic dissolution.
How are disputes between partners resolved?
Through the partnership agreement or by court if unresolved.
What is an implied authority in partnership law?
The assumed authority of a partner to bind the firm in usual business.
Are partners agents of the firm?
Yes
What is the role of the court in partnership disputes?
The court can resolve disputes or order dissolution.
What happens if there is no agreement on profit sharing?
Profits are shared equally under the default rules.
Can a partner be expelled?
Only if the partnership agreement permits it.
What is a ‘partnership at will’?
A partnership with no fixed term that can be dissolved at any time by any partner.
What is the importance of a partnership deed?
It helps prevent disputes by clearly defining roles and responsibilities.
How is decision-making handled in a partnership?
Each partner usually has equal say unless agreed otherwise.
What legal form protects partners from personal liability?
A Limited Liability Partnership (LLP).
Who pays tax in a general partnership?
The partners
Is a partnership considered a separate entity for tax purposes?
No
What is meant by ‘dissolution by notice’?
A partner may end the partnership by giving notice if it’s a partnership at will.
