ALL Agency and Partnership BBQs

A business relationship that is more limited in its scope and duration than a general partnership is referred to as which of the following?

D.Joint venture.

In accordance with RUPA, which of the following is suggestive of the existence of a partnership relationship between two parties?

B.Both parties control and use the same property for carrying out business.

Which statement below describes what is needed for a sub-partnership to exist?

D.A partner must agree to share her profits and losses from the partnership with a third person.

In which of the following businesses is the limited liability partnership entity most commonly used?

C.A law firm.

Which of the following is a default rule under the RUPA?

A.All partners share profits and losses equally unless the partners designate otherwise.

In the absence of a specific provision in the partnership agreement, how are decisions made in a partnership?

B.Decisions on matters in the ordinary course of business are decided by a majority of the partners, while all other matters require unanimous consent.

All the following are rights possessed by a partner in a partnership, except which?

D.The right to be compensated for all services rendered for the partnership during the ordinary course of business.

Which of the below is an accurate statement about fiduciary duties owed by partners in a partnership?

A.Fiduciary duties apply during the winding up of the partnership.

Under the RUPA, to what extent, if at all, may a partnership agreement alter or eliminate the duty of loyalty?

B.The duty of loyalty may be altered or eliminated so long as it is not manifestly unreasonable to do so.

An inquiry into whether an opportunity is a “partnership opportunity” for purposes of an appropriation claim will consider all the following, except which?

C.Whether the opportunity was first discovered by a partner prior to the formation of the partnership.

Which statement below accurately describes the RUPA’s requirement for furnishing material, financial information about the partnership to the individual partners?

B.The partnership is not required to render such information when it has reasonable belief that the partners already know of the information.

Under the RUPA, who has the authority to bind a partnership to a third party?

D.Any partner may bind the partnership when acting in the ordinary course of business, unless the third party knows that the partner lacks authority.

Who is a “purported partner”?

B.A person who holds herself out as a partner, even though she is not.

Under what circumstances, if any, could a partner be liable to a third party for obligations incurred prior to the person’s admission as a partner?

A.Where the newly admitted partner signed a waiver to this effect.

A transferee of a partner’s ownership interest has which of the following rights?

C.The right to receive any distributions to which the transferor would have been entitled.

All the events below will cause a partner to be dissociated from the partnership, except which?

A.The partner transfers her entire interest in the partnership to a third party.

If a partnership is for an unlimited term, under what circumstances would a partner’s dissociation be wrongful?

B.Only where the dissociation violates an express provision of the partnership agreement.

Under what circumstances, if any, will a partner’s dissociation not affect his right to participate in the partnership’s management and control?

B.Where the dissociation was rightful and resulted in dissolution of the partnership.

Which of the following is grounds for dissolution of a partnership by judicial decree?

A. It is not reasonably practicable to carry on the partnership business.

To what extent, if any, may grounds for dissolution be eliminated by the partnership agreement?

D.The partnership agreement may eliminate grounds for dissolution other than those stated in a judicial decree of dissolution or the rights of a transferee to seek dissolution.

Which statement below accurately describes the role of partners in winding up the partnership?

B. Partners are entitled to be compensated for their services in winding up the partnership.

What act typically creates a limited partnership?

D.The filing of a certificate of limited partnership with the state.

Which of the below is an accurate statement about distributions made in a limited partnership?

C.A distribution may not be made if the limited partnership’s total assets are less than its total liabilities.

Unanimous consent of all partners in a limited partnership is required for all the following, except which?

C.A general partner’s transferring of her entire interest in the limited partnership.

Which statement below accurately describes the management rights of partners in a limited partnership?

A.The general partners have equal rights, and they alone decide all matters relating to the business of the limited partnership.

Which statement below best characterizes the rights of limited partners to access information about the limited partnership?

A. Limited partners may generally inspect and copy any limited partnership information required to be maintained, regardless of the purpose for the request.

What fiduciary duties do partners in a limited partnership have?

B.General partners owe the partnership and the other partners the duties of loyalty and care, but limited partners do not.

What right do partners in a limited partnership have to dissociate from the limited partnership?

B.A general partner has the power to dissociate but may be liable for damages for wrongful dissociation, whereas a limited partner has no right to voluntarily dissociate prior to the winding up.

Which statement below accurately describes the level of assent among partners generally required to approve a plan of merger?

B.For a general partnership, all partners must give assent unless the partnership agreement provides otherwise; for a limited partnership, the law of the jurisdiction will always govern.

Which statement below accurately identifies who must approve the conversion of a limited partnership into a general partnership?

C.All the general partners and all the limited partners.

To create an agency relationship, who must consent to the formation?

C.Both the agent and the principal.

In an agency relationship, who has the right to control the agent’s actions?

B.The principal.

When, if ever, can an agent represent two parties to the same contract?

C.Only when the agent has fully advised both parties of the dual representation and both parties have consented to same.

Which of the following best defines an undisclosed principal?

D.A principal whose existence and identity are not known to the third party.

What is the most important factor in distinguishing a principal-independent contractor agency relationship from an employer-employee agency relationship?

B.The degree of control over the agent’s behavior that the principal has the right to exercise.

Which of the following is an accurate statement about termination of a common law agency relationship?

D.Both the agent and the principal have the power to end the relationship at any time.

In which situation below would an agency relationship continue after the death of the principal?

B.Where the agency was granted in connection with a security interest.

With what type of authority does an agent act when, based on the principal’s communications to her, the agent reasonably believes that she possesses the principal’s permission to perform the act?

A.Actual authority.

Acts taken by an agent that are necessary, usual, and proper for accomplishing the task the principal has assigned to her are performed under what type of authority?

B.Implied actual authority.

Where a corporation is the principal, who are the agents with actual authority to bind the corporation?

C.The officers.

Under what circumstances, if any, can an agent unilaterally create apparent authority to act and bind the principal?

D.Never.

In addition to a principal’s representation to a third party that an agent possesses authority, what else is required to create apparent authority?

C.The third party must reasonably believe that the agent has authority.

What term refers to a principal whose existence is unknown to a third party who is contracting with the principal’s agent?

D.An undisclosed principal.

An agent’s apparent authority will be terminated when a third party receives notice of any of the following circumstances, EXCEPT which?

B.The principal is terminally ill.

Which of the following best describes the doctrine of inherent agency power?

A. It permits the court to find a principal liable even when the agent lacked both actual and apparent authority.

All the following are requirements for a principal’s ratification of an agent’s unauthorized act, EXCEPT which?

A.The principal must ratify the act through oral or written words.

An agent generally is not liable to a third party under a contract negotiated on behalf of which of the following?

A.A disclosed principal.

Which of the below is required for a principal-employer to be vicariously liable for a tort committed by its agent-employee that harmed a third party?

C.The agent was acting within the scope of employment at the time the tort was committed.

What is the primary area of inquiry for determining whether an agent was an employee or independent contractor at the time the agent committed a tort?

D.Whether the principal exercised or had the right to exercise control over the agent with respect to performance of the work.

Which of the following facts, if true, would make it more likely that an agent is an independent contractor of the principal, as opposed to an employee?

B.The agent has specialized training needed to perform the particular work.

Which of the following statements accurately describes how the duration and method of an agent’s pay affects the determination as to whether he is an employee or an independent contractor?

D.An agent paid over a long duration is more likely to be an employee.

To what does the “duty of good conduct” refer?

A.The agent’s duty not to damage the principal’s reputation or business.

If a principal-employer hires an agent-employee for a job in which force would not be reasonably expected to be used, when, if ever, can the agent’s use of force on the job be within the scope of employment?

A.When the force was used in escalation of the agent performing a task for the assigned job.

Under what circumstances, if any, is an employee traveling home from work likely “within the scope of employment”?

C.Where the employer supplied the vehicle to better respond to the employer’s needs.

After much due diligence, a company hired an independent contractor to blast through a mountain on its property to facilitate the construction of a private road.

If the explosion caused by the independent contractor sends debris into the air that strikes a vehicle on a public highway, will the company likely be held liable for any negligence on the part of the independent contractor?

C.Yes, because blasting is an inherently dangerous activity.

A principal hires an uninsured independent contractor without verifying that it carried liability insurance.

D.Negligence.

What fiduciary duty generally restricts an agent from using the principal’s property for the agent’s personal benefit?

B.The duty of loyalty.

Which of the following acts, if done by an agent without the principal’s knowledge and for the purpose of competing with the principal, would breach the duty of loyalty?

C.Soliciting prospective clients of the principal.

What fiduciary duty requires an agent to act only within the agent’s given authority?

D.The duty of obedience.

To what does the “duty of good conduct” refer?

A.The agent’s duty not to damage the principal’s reputation or business.

What fiduciary obligation, if any, does a principal owe an agent within the context of an agency relationship?

C.The principal must indemnify the agent for payments made or losses incurred.