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28 Cards in this Set
- Front
- Back
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What duties does an agent owe his principal?
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Loyalty
Obedience Care Notification |
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How do you determine if an agent is an independent contractor or servant?
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Magic words "right to control" means he's a servant
Look to salary, skill, whether he has his own business, length of employment, whether he owns his tools, whether business location is same as boss's |
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When is a principal vicariously liable for the actions of servant?
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If within the scope of employment
Intentional torts generally not within scope Commuting generally not within scope (MD exception) |
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When is a principal vicariously liable for the actions of an independent contractor?
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Generally no unless:
Nondelegable duty Hired to engage in an inherently dangerous activity |
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What is the borrowed servant doctrine?
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If agent is borrowed by someone else, who is vicariously liable depends on who was in control at the time
MD: can be servant of BOTH |
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What is the apparent agency theory?
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Where principal is vicariously liable b/c the third party reasonably relied on ads that the local gas station repair person was a servant of the national oil co
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How does A have authority to act for P?
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Express authority
Implied authority: A's reasonable interpretation of what P told her to do based on common sense, past dealings, custom and trade Apparent authority: T's reasonable belief that A is authorized based on past manifestation from P to T, based on something P told T, past dealings, or custom and trade Ratification: retroactive authorization back to time of contract Must be done before T withdraws; can't ratify material change or illegal activity |
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What are disclosed, partially disclosed, and undisclosed Ps?
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Disclosed: T knows of P and his name
Partially disclosed: T know of P but not his name Undisclosed: T doesn't know of P |
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If A had authority to act, who is liable on the contract?
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Disclosed P: A can't sue/be sued (except under breach of warranty of authority theory)
Partially disclosed P: all parties can sue/be sued Undisclosed P: all parties can sue except P can't enforce the contract if: T contracted based on trust/confidences in A T would have refused the deal if she had known of P or Contract language expressly denies undisclosed P any rights |
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What is the abusive discharge exception?
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At will employee can't be discharged if it would violate a clear mandate of public policy
If statute provides a remedy: no violation If employee sued for something unrelated to his job: no violation If employee is fired for saying he wants to talk to a lawyer, no violation |
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How do you form a partnership?
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Need at least 2 people
Intent of parties: presumed where there are shared profits No need for filing or writing Agreement to share losses or create a joint tenancy or tenancy in common also helps show intent Sharing gross returns or gross receipts does not indicate intent |
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Who can be held liable for partnership debt?
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The partnership
Partners are personally jointly and severally liable |
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What is a purported partner?
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Represents himself as a partner AND
3d party extends credit to the business reasonably relying on the belief that he is a partner |
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How are decisions of the partnership made?
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Ordinary business: majority vote
Selling partnership's good will, admitting new partner, non-ordinary business: UC |
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What is dissociation?
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Partner quits, dies, goes bankrupt or is expelled
should file statement of dissociation with SADT Otherwise, liable for two years if creditor reasonably relied on him being a partner |
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What are partners' rights and duties?
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Equal voting power, inspection rights
Profits shared equally Fiduciary duties: duty of care, good faith and fair dealing, loyalty |
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How does dissolution occur?
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Partnership at will: partner can quit without liability
Parnership for a term: term expires Judicial dissolution if: Economic purpose of partnership will be unreasonably frustrated Another partner has engaged in conduct which makes it not unreasonably practicable to carry on the business wiht that partnier or It is not reasonably practicable to carry on the partnership business in conformity with the partnership agreement Continues after dissolution through winding up |
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What is a joint venture?
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partnership that is limited in time and scope
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What is a limited liability partnership?
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partnership where no partner can be personally held liable; have to file certificate with SADT
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What is a limited partnership?
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Has at least one general partner and one limited partner
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When can a limited partner in a limited partnership be held liable?
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Generally he can't unless:
He takes control of the business His name is included in the LP name and creditors believe he's a general partner |
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How is an LP formed?
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Must file certificate with SADT stating that it is an LP, include name and addresses of resident agent and general partners, latest date of dissolution
Failure to file leads to personal liability of limited partners UNLESS Limited partner had godo faith belief that filing had been complete and within 30 days of knowing of failure to file, he files |
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What are the rights of limited partners to an LP?
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Profits based on percentage of capital contribution
Must own at least 5% to inspect tax records Can bring derivative action Can petition court for dissolution |
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How are new partners admitted to an LP?
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UC of all general partners + majorty vote of limited partners, who vote based on capital contribution
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Who can withdraw from an LP?
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Limited partner: as permitted by the LP agreement
General partner: anytime by written notice |
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How is dissolution affected in an LP?
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Withdrawal or death of a general partner (not a limited partner)
Judicial dissolution Consent of all partners Event specified in the certificate |
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What is a foreign limited partnership?
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LP formed in another state that wants to do business in MD must file with SDAT or else face a fine or inability to sue in MD court
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What is an LLC?
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Requires only one person; must file with SDAT
Members not liable for LLC debts Members can manage Members share profit based on capital contribution |
