Quiz 41: Types of Business Organizations


A) Joint ventures are not limited to only two persons; they can have more than two. Incorrect. b) Joint ventures are for profit not non-profit. Incorrect. c) Joint venture is not a corporation. Incorrect. d) Joint venture is for a single undertaking, e.g. group of friends making a movie together and selling it. Correct.

The case facts: The companies MI and CO formed a joint venture named MC to better compete with the dominant manufacturer in the beer industry. Both the companies had an agreement to resolve disputes, and distribute the revenue between them to carry out venture operations. Ohio Alcoholic Beverage Franchise Act caused termination of beer distributors. MC notified that Ohio law had terminated its distributorship. Ohio Alcoholic Beverage Franchise Act : The law regulates the franchise relationship between the Ohio distributors to re-sale alcoholic beverages and Ohio retailers. According to this act, no manufacturer or distributor would fail to act under the terms of franchise to sale or distribute alcohol. The franchise act avails an exceptional cause for the termination if "a successor manufacturer acquires all of the stock of another manufacturer through merger or acquisition of one alcoholic manufacturer with another manufacturer". Adhering to franchise act, MC declared that its venture was authorized to terminate distributorship by successor manufacturer. Therefore, the plaintiff, alcoholic distributor have the right to continue its distribution franchise.

Case brief: Four persons named J, SH, G and EL agreed to purchase a piece of land and decided to make it available for use as a playground for children. They called that playground with a name MDW. J and G improperly fixed a swing and due to that a child was injured. Can a law suit can be brought against playground. Unincorporated association It is a combination of two or more people for fulfilling a common purpose. The authority of unincorporated association is governed by contract law. It is not established by a statute hence it is not having any legal existence. It cannot sue or sued by other persons legally. Generally, the persons of this association are not liable for the liabilities. Opinion Here in this case scenario, the MDW was an unincorporated association the child unable to sue the playground because the owners did not incorporate the playground name. They merely named the playground. There is no legal existence for it. Therefore, it is an unincorporated association which cannot be sued hence, the damages cannot be recovered from it.

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