Question 1

"Dissolution" of a partnership and "termination" of a partnership are synonymous.

Accepted Answer

"Dissolution" refers to the process of ending a partnership, while "termination" specifically refers to the end of the partnership agreement. They are similar but not synonymous terms.

Question 2

A person admitted into an existing partnership is personally liable for all of the obligations of the partnership arising before his admission.

Accepted Answer

A person admitted into an existing partnership is not automatically personally liable for obligations of the partnership that arose before their admission. They may become liable to the extent agreed upon in the partnership agreement or by subsequent agreement with the creditors.

Question 3

Respondeat superior has no application to situations where a partner commits a tort, because only the partner and not the partnership is liable.

Accepted Answer

Respondeat superior can apply to situations where a partner commits a tort if the tort was committed within the scope of partnership business. In such cases, the partnership as well as the partner can be held liable.

Question 4

Aileen, Jamie, and Delmer are partners in a florist shop. If Delmer engages in conduct that makes it not reasonably practicable to carry on the business, the partnership is dissolved by operation of law.

Accepted Answer

The partnership is not automatically dissolved by operation of law due to a partner's conduct making it not reasonably practicable to carry on the business. Instead, the other partners may need to seek a judicial dissolution or agree upon dissolution according to the partnership agreement or applicable partnership laws.

Question 5

Randy, Mona, and Richard are partners. Under the UPA, a creditor of their partnership must name all three partners as defendants in a suit on a contract obligation of the partnership.

Accepted Answer

Under the UPA, all partners in a partnership are jointly and severally liable for the debts and obligations of the partnership. Therefore, if a creditor wants to sue the partnership for a contractual obligation, all partners must be named as defendants in the suit.

Question 6

The RUPA requires a central filing of a statement of partnership authority specifying the names of partners authorized to execute instruments transferring real property held in the name of the partnership.

Accepted Answer

The answer of The RUPA requires a central filing of...

Question 7

The UPA marshaling of assets doctrine is abolished by the RUPA.

Accepted Answer

The Revised Uniform Partnership Act (RUPA) abolished the UPA's marshaling of assets doctrine, which required the partnership to exhaust all available partnership assets before going after a partner's personal assets to satisfy a creditor's claim.

Question 8

The actual express authority of partners must be specifically set forth in the partnership agreement.

Accepted Answer

While the partnership agreement can outline the authority of partners, there are other factors that can establish authority, such as the usual course of business or implied authority.

Question 9

If a partner has paid more than his share of partnership losses, he has a right of contribution against the partners who have not paid their share.

Accepted Answer

This is known as the right of subrogation, where the partner who has paid more than their share of partnership losses can seek contribution or reimbursement from the partners who have not paid their share.

Question 10

A partner has implied authority to hire and fire employees whose services are necessary to carry on the partnership business.

Accepted Answer

This means that if an employee is necessary for the operation of the partnership business, a partner has the authority to hire or fire them without seeking the approval of the other partners. However, if the employee is not necessary for the business or the partner has exceeded their authority, then the other partners may contest their decision.

Question 11

Much of the law of partnership is the law of agency.

Accepted Answer

This statement is true. Partners in a partnership are agents of the partnership and each other, which means they have the authority to act on behalf of the partnership and bind it to contracts and other legal obligations. Therefore, much of the law of partnership involves the principles of agency law.

Question 12

Notification to one partner of any matter relating to partnership affairs is effective immediately as notice to the partnership.

Accepted Answer

This is the general rule for partnerships under the Uniform Partnership Act. Notification to one partner is considered notice to the partnership as a whole. However, there can be exceptions to this rule depending on the specific partnership agreement or state laws.

Question 13

Any partner by himself has the power to dissolve a term partnership by giving notice to the other partners.

Accepted Answer

In a term partnership, which is a partnership set for a specific duration, one partner cannot unilaterally dissolve the partnership by simply giving notice to the other partners. Dissolution under these circumstances typically requires mutual agreement or circumstances outlined in the partnership agreement.

Question 14

Norma leaves the Tri-County Accounting Partnership. She may immediately compete with the partnership for new clients and may collect and keep the fees she earns from both new clients and from old clients on account of transactions she completes from her partnership with Tri-County.

Accepted Answer

Norma may be subject to a non-compete agreement or fiduciary duties that restrict her ability to immediately compete with the partnership or solicit its clients.

Question 15

Powell falsely tells Dunagan that she is a member of the partnership of Morgan and Stiles. Dunagan mentions this information to Trammell, who in reliance sells equipment on credit to Morgan and Stiles. Trammell can hold Powell liable for the misrepresentation.

Accepted Answer

The answer of Powell falsely tells Dunagan that she is...

Question 16

Partners are not required to participate in winding up the partnership.

Accepted Answer

Partners are required to participate in winding up the partnership.

Question 17

Under the RUPA, a judgment creditor of a partnership may first attempt to enforce a judgment against either the separate assets of a partner or the partnership itself.

Accepted Answer

The answer of Under the RUPA, a judgment creditor of...

Question 18

Upon dissolution, a partner still has authority to complete existing contracts.

Accepted Answer

According to the Uniform Partnership Act, upon dissolution, a partner still has authority to complete existing contracts. However, they cannot enter into new contracts on behalf of the partnership.

Question 19

Under the RUPA, dissolution occurs automatically upon the happening of an event specified in the partnership agreement as resulting in dissolution. The partners may not agree to continue the business.

Accepted Answer

Under the RUPA (Revised Uniform Partnership Act), even if an event specified in the partnership agreement as causing dissolution occurs, the partners can unanimously agree to continue the business, thereby preventing automatic dissolution.

Question 20

Upon dissolution of a partnership, all authority of a partner to act on behalf of the partnership terminates.

Accepted Answer

Upon dissolution of a partnership, a partner retains the authority to perform acts appropriate for winding up partnership affairs or completing transactions unfinished at dissolution, but cannot undertake new business activities on behalf of the partnership.

Quiz 31: Operation and Dissolution of General Partnerships