UNIT 1 HOMEWORK LAW 206
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American Military University *
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206
Subject
Law
Date
Jan 9, 2024
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Uploaded by ProfessorRam11604
1.
For the term “RUPA,” please do the following: a.
Provide the definition (quote from the textbook, with page number, OR quote from another permitted source – i.e. an online law dictionary, with proper source citation).
“The Revised Uniform Partnership Act (RUPA) of 1994, with the 1997 amendments, is a
model partnership statute that is the product of the National Conference of
Commissioners on Uniform State Laws, a group of practicing lawyers, judges, and law
professors. The aims of the RUPA are to codify partnership law in one document, to make
that law more nearly consistent with itself, and to attain uniformity throughout the
country.” Langvardt, A.W., Barnes, A.J., Prenkert, J.D., McRrory M.A., & Perry, J.E.
(2019) Business Law
(P. 1037)
b.
Explain the term in your own words.
Rupa in my own words is. Created partnership that is created and organized. All partners
under RUPA have duties and rights they must abide by. The biggest part with partnership
businesses is them gaining the help they need to meet the needs of their business. There
are 12 states that have not adopted RUPA so a state without it doesn’t have to abide by
what falls under RUPA.
c.
Provide an example (either your own, OR one that is in the text, OR one that is in another permitted source, with proper source citation).
“The federal income tax return filed by a partnership, Schedule K-1, is merely an
information return in which the partnership indicates its gross income and deductions and
the names and addresses of its partners (IRC Sec. 6031). The information return allows
the Internal Revenue Service to determine whether the partners accurately report
partnership income on their individual returns. Langvardt, A.W., Barnes, A.J., Prenkert,
J.D., McRrory M.A., & Perry, J.E. (2019) Business Law
(P. 1038)
2.
Follow the format above for the term “Dissociation.”
a.
Provide the definition (quote from the textbook, with page number, OR quote from another permitted source – i.e. an online law dictionary, with proper source citation).
Dissociation is defined in the Revised Uniform Partnership Act of 1997 (RUPA) as , “a
change in the relation of the partners caused by any partner’s ceasing to be associated in
the carrying on of the business. A dissociation may be caused by a partner’s retirement,
death, expulsion, or bankruptcy filing, among other things.” Langvardt, A.W., Barnes,
A.J., Prenkert, J.D., McRrory M.A., & Perry, J.E. (2019) Business Law
(P. 1072)
b.
Explain the term in your own words.
Dissociation in my own words is partners in businesses having certain rights with certain
obligations to withdraw themselves from a business. Especially if it falls under a
nonwrongful dissociation compared to a wrongful dissociation. For example, when a
partner’s dissociation is not in violation of a partnership agreement and falls under
nonwrongful dissociation events, that partner has the right to retract their agreements or
partnership with that other person or business. One event that I feel is important under
nonwrongful dissociation is a partnership that allows a partner to retire at a certain age.
Why I feel this is important because some people as they age develop health issues that
can interfere with their ability to uphold their duties as a partner. nonwrongful
dissociation events, that partner has the right to retract their agreements or partnership
with that other person or business.
c.
Provide an example (either your own, OR one that is in the text, OR one that is in another permitted source, with proper source citation).
An example of dissociation is. Nonwrongful, “Withdrawal of a partner in accordance with the partnership agreement. For example, a partnership agreement allows the partners
to retire at age 55. A partner who retires at age 60 has dissociated from the partnership nonwrongfully. Wrongful, “Withdrawal of a partner before the end of the partnership’s term or completion of its undertaking, unless the partner withdraws within 90 days after another partner’s death, adjudicated incapacity, appointment of a custodian over his property, or wrongful dissociation.”
3.
Compare a Sole Proprietorship with a Sole Member, LLC. What are the advantages and/ or disadvantages of each?
Sole proprietorship:
“Has only one owner. The sole proprietor is merely an extension of its only owner, the
sole proprietor has the right to make all the management decisions of the business. In
addition, all the profits of the business are his/hers.” Langvardt, A.W., Barnes, A.J.,
Prenkert, J.D., McRrory M.A., & Perry, J.E. (2019) Business Law
(P. 1032)
Advantages of sole proprietorship:
-Formed easily and inexpensively.
-Not a legal entity. Cannot sue or be sued. Creditors must sue the owner. They also must
sue ones who harm the business.
-All income is income of the sole proprietor’s and must be reported on his/her federal
income tax return.
Disadvantages of sole proprietorship:
-Responsible for all obligations of the business.
-All debts of the business, including contract debt signed are the sole proprietor debts in
his/her name of the business.
-Sole proprietor could lose everything if his business becomes insolvent. Why a sole
proprietorship is a risky business despite the advantages for an owner.
Sole member, LLC:
When formed as a single-member LLC, the company becomes its own legal entity.
Members are not held responsible for debts or legal action against the business.
Advantages of sole member, LLC:
-Easy to give ownership to another individual since it exists as a separate entity.
-Can change from a single-member to multi-member LLC by filing an amendment with
the individual respective state.
-Limited liability company with a single owner, and LLCs refer to owners as members.
They are considered separate legal entity, because how liabilities are treated.
Disadvantages of sole member, LLC:
-To remain in good standing, various compliance forms are required.
-Because a separate entity will be created, will need extensive paperwork to form an
LLC.
4.
List five legal terms that you would insist upon being included as clauses in a
partnership agreement if you were forming one. Explain why you want each clause
and include any citations to support your work.
Dissolution and winding up:
“Involves orderly liquidation-or sale of assets of the business. Liquidation may be
accomplished asset by asset; that is, each asset may be sold separately. May also be
accomplished by a sale of the business by a whole.” Langvardt, A.W., Barnes, A.J.,
Prenkert, J.D., McRrory M.A., & Perry, J.E. (2019) Business Law
(P. 1075)
Partnership capital:
“Partners contribute cash or other property to the partnership. The partner’s contribution
is called partnership capital. To supplement beginning capital, other property may be
contributed to the partnership as needed, such as by the partners permitting the
partnership to retain some of its profits. Partnership capital is the equity of the business.”
Langvardt, A.W., Barnes, A.J., Prenkert, J.D., McRrory M.A., & Perry, J.E. (2019)
Business Law
(P. 1075)
Liability of new partners:
“New partners fully liable for all partnership obligations incurred after he becomes a
partner, for he clearly benefits from the partnership during that time. It is a RUPA rule.”
Langvardt, A.W., Barnes, A.J., Prenkert, J.D., McRrory M.A., & Perry, J.E. (2019)
Business Law
(P. 1085)
Torts:
“The partnership and the other partners are liable jointly and severely for the torts of a
partner committed within the ordinary course of partnership business or within the
authority of that partner.” Langvardt, A.W., Barnes, A.J., Prenkert, J.D., McRrory M.A.,
& Perry, J.E. (2019) Business Law
(P. 1065)
Having interest adverse to partnership:
“Unless there is a contrary agreement a partner’s sole compensation from partnership
affairs is a share of partnership profits. Therefore, a partner may not deal with the
partnership when the partner has an interest adverse to the partnership or acts on behalf of
another person with any adverse interest.” Langvardt, A.W., Barnes, A.J., Prenkert, J.D.,
McRrory M.A., & Perry, J.E. (2019) Business Law
(P. 1054)
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