B_LAW 210 – 1st Edition Lecture 12 Outline of Last Lecture 1. Consent2. Statute of FraudsOutline of Current Lecture I. Business Entities (Part 1)a. Sole Proprietorb. General Partnershipc. Limited PartnershipCurrent Lecture- Sole Proprietor:o Starts doing a business aloneo No writing required to form businesso Has SOLE control of businesso Termination: Sells business Stops doing the business Deatho Fully liable for all losses and liabilitieso Owner pays business’s taxes on personal return- General Partnership:o Oral or written agreement between 2 or more parties to carry on a business for profit Technically, no writing is requiredo A general partnership can be assumed when two or more people carry on a businesso Partners have a fiduciary duty to one another – meaning they must disclose all financial aspects of the business and not co-opt a financial advantage that is properly the partnerships The duty ends after a partner leaves.o Each partner has an equal voice unless otherwise statedo Majority rules, except decisions to sell or add a partner requiring an unanimous voteThese notes represent a detailed interpretation of the professor’s lecture. GradeBuddy is best used as a supplement to your own notes, not as a substitute.o Termination: Changes in partners dissolves old partnership and forms a new one Death, withdrawal or bankruptcy will terminate partnership Many written partnership agreements provide that these events will not terminate a partnership A partnership for a specific purpose will dissolve automatically upon specified evento General partners all jointly and severally liable for all losses and liabilities.o Partners pay business’s taxes on personal return- Limited Partnership:o Must have a written agreement between 2 or more parties, must have one general partner who makes business decisions (limited partners do not have a vote) Agreement must include: name of business, type of business, address of agent, names of addresses of each partner, contribution of each partner, duration of partnership, rights of personnel changes, and share of profit to be paid to each partner May be required to register with the state (certificate of partnership)o Limited partners may not participate in management (they are merely investors) but may see finances and participate in dissolution of partnership.o General partners owe a fiduciary duty, while limited partners (generally) do noto Only General partners can voteo Termination: (With respect to the general partner, same rules) Death, withdrawal or bankruptcy of limited partner does not trigger a dissolution Limited partners receive their share of profits and their capital contributions before general partners receive anything A limited partnership may dissolve per the agreement or at the completion of a project Certificate of limited partnership may set out dissolution dateo Limited partners are not liable for anything other than their capital contributiono General partners are jointly and severally liable for all losses and liabilities If a limited partner participates in the management of the business, they will lose their limited liability protectiono Partners pay taxes on their personal