Jessica had operated a business for several years.Because the number of customers increased significantly,she persuaded Zach to work together with her.Two years after Zach came aboard,Jessica committed a tort while acting in the course of the business and caused a customer to suffer a substantial loss.A question has arisen as to whether Zach and Jessica were partners.Which of the following statements is TRUE?

Question

Quizplus · Accepted Answer

A partnership can exist even if there is no formal agreement or if the parties signed a document stating that their relationship is not a partnership. The key factor in determining whether a partnership exists is whether the parties intended to carry on a business together with the aim of making a profit. In this case, Zach and Jessica worked together and shared profits, which suggests that they intended to operate as partners, regardless of any formal agreement or lack thereof.

Jessica Had Operated a Business for Several Years