1-1 Discussion- Partnership
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Southern New Hampshire University *
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307
Subject
Law
Date
Jan 9, 2024
Type
docx
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2
Uploaded by BaronNeutron3360
Hi Professor and fellow classmates,
My children and I reside along the Gulf of Mexico in South Louisiana (the only state not to adopt
the Uniform Partnership Act of 1997—interesting
fact obtained from this week's research). I
have only a hand full of classes remaining to complete my bachelor's degree in Accounting. I am
eager to participate in discussions, interact with classmates throughout the term, and learn more
regarding legalities for businesses and business owners.
As in the case of Leoff v. S & J Land Co, the courts followed settled Colorado Law which
references the Uniform Partnership Act description of a partnership as "the association of two or
more persons to carry on as co-owners a business for profit...whether or not the persons intend to
form a partnership." (Kubasek et al., 2020) As stated in
C.R.S. 7-64-202
and
C.R.S. 7-60-107
,
when profits of a business are shared, it is presumed the persons receiving the shares are partners
in the company. Judge Hartz concluded that the two parties were partners per the 2006
Management Agreement, which stated that "…Leoff is entitled to 30% of all profits or losses of
S&J…and that if S&J suffered a loss rather than a profit, then Leoff's pro-rata share must be
accounted for" (Kubasek, 2020).
Looking more closely at the evidence presented in the case concerning the existence of a
partnership, Leoff's assertion regarding the contract's lack of relationship details coupled with the
30% profit percentage as payment for his services provoked a closer look at the facts. The
Management Agreement signed in 2006 lists Leoff as a manager for a specific project. Therefore,
the only scenario initially considered is that the 30% Leoff receives is given to him as an
independent contractor or an employee (wages) rather than as a partner; this would form an
employer-employee or employer-independent contractor agency relationship. However, the case
states that Leoff also shared in business losses, suggesting he was more than a manager and
contradicted his claim that payments were only for his services.
The universalization test, in brief, is a form of a moral test that "…asks us to consider what the
world would be like were our decision copied by everyone" (Kubasek, 2020). When any
agreement, whether written or oral, is formed, risks and benefits may arise from that agreement.
A partnership focuses on both parties; therefore, each party must be mindful of their own actions
and any potential consequences resulting from those actions which could negatively affect the
other party. As a partnership, it is not making decisions alone but weighing the options together
and deciding what is best for both parties and the business. Avoiding partnership responsibilities
can generate ethical issues, creating a lack of trust between partners. A business can only succeed
when partners respect, trust, and communicate effectively. Although it may seem "easy" to only
think about oneself in a situation, when you enter into a partnership, you also take on the
responsibility of determining the future of the other party. I firmly believe in the golden rule:
always treat others as you wish to be treated. What if the roles were reversed?
Regards,
****
References
Colorado Revised Statutes
. Colorado Legal Resources. (2022). Retrieved September 1, 2022,
from https://leg.colorado.gov/sites/default/files/images/olls/crs2020-title-07.pdf
Kubasek, N. K., Browne, M. N., Dhooge, L. J., Herron, D. J., & Barkacs, L. L. (2020).
Dynamic
Business Law
(5th ed.). McGraw-Hill Education.
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