Fact Pattern 27-3
Bryn, Cornell, and Duke are general partners in Equity Lending, a consumer credit, mortgage, and investment firm. Their agreement states that it is a breach of the agreement for any partner to assign his or her interest to a creditor without the consent of the other partners.
-Refer to Fact Pattern 27-3. Bryn, Cornell, and Duke decide to admit Giselle as a new partner in Equity Lending. Giselle's liability for partnership debts incurred before her admission is
A) limited to her capital contribution to the firm.
B) limited to her personal assets.
C) nothing.
D) unlimited.

Question

Fact Pattern 27-3
​Bryn, Cornell, and Duke are general partners in Equity Lending, a consumer credit, mortgage, and investment firm. Their agreement states that it is a breach of the agreement for any partner to assign his or her interest to a creditor without the consent of the other partners.
-Refer to Fact Pattern 27-3. Bryn, Cornell, and Duke decide to admit Giselle as a new partner in Equity Lending. Giselle's liability for partnership debts incurred before her admission is​
A) ​limited to her capital contribution to the firm.
B) limited to her personal assets.
C) ​nothing.
D) ​unlimited.

Quizplus · Accepted Answer

Giselle's liability for partnership debts incurred before her admission is limited to her capital contribution to the firm. This limitation is a characteristic of general partnerships where each partner's liability is limited to the amount of capital they contributed to the partnership. However, if Giselle engages in any partnership activities after her admission, her liability becomes unlimited for partnership debts incurred during that time.

Fact Pattern 27-3 ​Bryn, Cornell, and Duke Are General Partners in Equity Lending

Fact Pattern 27-3 Bryn, Cornell, and Duke Are General Partners in Equity Lending