Question 1

Under the RUPA, a partner in a term partnership who wrongfully dissociates before the end of a definite term cannot receive payment of a portion of the buyout price before the expiration of the term.

Accepted Answer

The answer of Under the RUPA, a partner in a...

Question 2

Dissociation refers to those situations in which the RUPA requires a partnership to wind up and terminate.

Accepted Answer

Dissociation refers to a partner leaving the partnership, which does not necessarily require the partnership to wind up and terminate; the partnership can continue with the remaining partners.

Question 3

Under the UPA, neither a partner who causes dissolution by wrongfully withdrawing nor a partner expelled pursuant to the partnership agreement can force liquidation of the partnership.

Accepted Answer

Under the Uniform Partnership Act (UPA), a partner who wrongfully withdraws or is expelled according to the partnership agreement does not have the right to force the liquidation of the partnership.

Question 4

A partner is criminally liable for the crimes of her partners.

Accepted Answer

A partner is not automatically criminally liable for the crimes of her partners unless it can be proven that they were involved in, or had knowledge of, the criminal activity and participated in some way.

Question 5

Under the RUPA, it is possible to cure an illegality within 90 days after notice to the partnership of the event dissolving the partnership for illegality.

Accepted Answer

Under the Revised Uniform Partnership Act (RUPA), if a partnership is dissolved due to an event that makes it unlawful for the business to be carried on or for the partners to carry on the business, the partnership may have 90 days after notice of the event to cure the illegality and avoid dissolution.

Question 6

If the general partnership is bound by a contract, then each individual general partner has unlimited personal liability for that obligation.

Accepted Answer

In a general partnership, each partner is personally liable for the debts and obligations of the partnership, meaning they have unlimited personal liability.

Question 7

A person who represents himself to third persons as being a partner when in fact he is not, may have the liability of a partner.

Accepted Answer

This is known as "holding out," and legally binds the person to the responsibilities and liabilities of a partner, even if they are not actually a partner in the business.

Question 8

Under the UPA, upon termination of a firm, each partner is entitled to the return of his capital after partnership creditors have been paid.

Accepted Answer

Under the Uniform Partnership Act (UPA), upon the termination or dissolution of a partnership, the assets of the partnership are distributed in a specific order: first to creditors (including partners who are creditors), then to partners for the return of their capital contributions, and finally, any remaining amounts are distributed to partners according to their respective shares in the profits.

Question 9

Under the UPA, which of the following liabilities of a partnership has the highest priority for payment out of partnership assets? Amounts owing to:

Accepted Answer

Under the Uniform Partnership Act (UPA), the liabilities of a partnership are prioritized in a specific order for payment out of partnership assets. The highest priority is given to creditors other than partners. This means that external debts or obligations owed to non-partner creditors are settled first before any distributions are made to partners for loans, advances, capital contributions, or profit shares.

Question 10

In a three person partnership, one partner commits fraud which creates a liability to the partnership of $9,000. If the three partners share profits and losses equally, each partner's liability to the partnership for the fraudulent act is $3,000.

Accepted Answer

The answer of In a three person partnership, one partner...

Question 11

A person has notice of a fact if the person has reason to know it exists from all of the facts known to the person at the time in question.

Accepted Answer

Notice of a fact means that a person is aware, or should reasonably be aware, of the fact based on the information available to them at the time.

Question 12

The withdrawal of a partner in a partnership at will may be either a rightful or wrongful dissociation.

Accepted Answer

The answer of The withdrawal of a partner in a...

Question 13

Under the RUPA, in a term partnership, if within 90 days after any specified cause of dissolution occurs, fewer than half of the remaining partners express their will to wind up the partnership business, the partnership will not dissolve.

Accepted Answer

Under the Revised Uniform Partnership Act (RUPA), if a specified event that could cause dissolution occurs, the partnership will not automatically dissolve if, within 90 days, fewer than half of the remaining partners vote to wind up the partnership business. This provision allows the partnership to continue despite the occurrence of potential dissolution events, provided there is not a majority interest in winding up the partnership affairs.

Question 14

The liability of partners for a tort or breach of trust committed by any partner is unlimited, personal liability.

Accepted Answer

According to the Partnership Act, partners are personally liable for any tort or breach of trust committed by another partner in the course of partnership business. This means that their liability is unlimited, and they may be held personally responsible for any damages or losses incurred as a result of the wrongful act.

Question 15

Winding up involves all but which one of the following?

Accepted Answer

Winding up a business involves liquidating assets, collecting receivables, and paying off creditors, but not taking new business orders.

Question 16

A partner has the power to dissociate at any time by expressing the intent to withdraw.

Accepted Answer

A partner in a partnership has the right to dissociate at any time, regardless of the partnership agreement, by expressing the intent to withdraw from the partnership.

Question 17

Jane, Keegan, and Lois are partners in a state that has adopted the RUPA. Jane intends to retire and withdraw from the partnership at the end of the year. Jane is liable to the firm's creditors:

Accepted Answer

Under the Revised Uniform Partnership Act (RUPA), a partner who dissociates from a partnership (in this case, Jane retiring) is liable for partnership obligations incurred within two years after their dissociation if the partnership has not dissolved and the creditor reasonably believed the dissociated partner was still a partner at the time of the transaction.

Question 18

A retiring partner has no way of being discharged from her existing liabilities other than by paying them off.

Accepted Answer

A retiring partner can be discharged from existing liabilities by an agreement between the retiring partner, the remaining partners, and the creditors.

Question 19

Under the UPA, submission of a partnership claim to arbitration requires the consent of all the partners.

Accepted Answer

Under the Uniform Partnership Act (UPA), any decision regarding the submission of a partnership claim to arbitration requires the unanimous consent of all partners, as it is considered a matter affecting the partnership as a whole.

Question 20

Under the RUPA, a partner's dissociation in a term partnership is wrongful if before expiration of the term:

Accepted Answer

The answer of Under the RUPA, a partner's dissociation in...

Quiz 31: Operation and Dissolution of General Partnerships