General Partnerships LAW Joint ventures treated as partnerships for most legal ventures No actual or apparent authority?

Liable to principal only if ratifies Share profit and losses, not gross receipts Dissolution? Existing liability still exists First pay off creditors, then capital accounts, and then profits Partnership assets first, then personal ones Contributions and obligations? Still have equal share or profits and losses Tort? Each partner pays pro-rata share No right to assign or attach property, but can distributions Inactive partners can inspect partnerships books Dont have to form with a signed document (joint ventures too) At will partnership? No durations LLP? Must file LP? Must file (different from GP and LLP because profits/losses are based upon capital contribution (or agreement) Limited Partner in an LP has no control over the partnership LLC? ARTICLES OF ORGANIZATION Corporation LAW Short-term merger: owning 90% doesnt require approval, but the subsidiary has the right to dissent and take advantage of the appraisal remedy Corporate Charter: Name or corporation, provision of authorizing tock, name of the incorporators, and name and address of registered agent Corporate veil? Comingling funds, under capitalized, shareholders/officers/and directors are assigned liability DAMNS: require all people involved board and stockholders (dissolution, articles of incorporation changes, mergers and consolidations, and sell of assets) Stock dividend on common stock has no effect for federal income tax purposes Derivative action: when others dont do action (ultra vires)

Pre-emptive rights: rights to first refusal of shares, but not entitled to proportionate shares Corporations CAN NOT be shareholders of an S-corporations (only individuals, estate and trust) Distribution to owners? Decrease S/E Shareholders and distribute property and NOT be taxed in a corporation and Scorporation Freely transferable? Corporation and is double taxed S-corporation? Limited liability of corporate form and taxed like partnership (no foreign shareholders) Stock dividends? Not distributions Cash dividend? Become unsecured creditor Promoter is let go through NOVATION Debt securities: bonds Equity securities: stock Director? Fiduciary Must give 5 days notice to inspect corporations books Derivative action suit: recovering damages from third parties Good business judgment rule? Do things in good faith? Not liable CHAPTER 5: CONTRACTS Novation: contract is unchanged but one of the original parties will be release Substituted Contract: original party released from one agreement and bound to another Contract: concurrent, subsequent, and present conditions Consideration: bargained for All assignable, UNLESS it increases risk (malpractice) Undue influence: person of trust takes unfair advantage Statute of limitation for breach? When it was breached Disaffirm after a certain day of reaching majority

Inadmissible: not allowable Ratify: give consent Pay debt of another? Must be in writing Ratify contract? When the minor is not of age Statute of fraud: signed by the defendant! (ONE WHO SIGNS) contract should be performed in a year (if oral) Liquidating damages (if you dont do something in x days you pay a fine) OK if not a penalty, and must be reasonable Amount in dispute? Consideration Contemporaneous oral agreement is not OK Oral agreement? Okay with evidence WHEN SUBSEQUENT Rescission: undoes the contract and parties are back to their original position X Y enter a contract, Y assigns rights to Z: X is the obligator, Y is the assignor, and Z is the assignee Personal services, obligator risk, or not legal? Not assignable Specific Performances: RARE AND UNIQUE: patent Promise to pay debt? Must be in writing Social Security: is not garnished Tender of performance: releases all sureties Respondent Superior: employers held liable for employees tort actions A third party can sue the agent and the principal (when disclosed) Common Law negligent misrepresentation: relied on the info CPA is an independent contractor Indemnify: reimburse To figure out allocation to debt: (x creditor)/total amount of debt X how much $ you have Only COURT can confirm plan WAFTED: not dischargeable Filing bankruptcy? Automatic stay stops judgment liens

Involuntary: not paying bonafide debts as they become due Involuntary? Needs the 12 creditors, and one who has at least 14,425 Chapter 11: creditors are unsecured Debt set aside by trustee if it occurred before 90 days of filing Exchange Act of 1934: file reports, negligence cant only suffice for intent to deceive Insurance policies are exempt; but not companies! Exempt offer for Regulation D? 12 months Act without good faith? Fraudulent! Workpapers belong to the CPA firm Negligence: duty of care, breach, causality, and injury Patent? Sell whatever price they want INSOLVENT? Ok to take over even if competition is stifled. Within 180 days? Insurance, inheritance, divorce? PART of bankruptcy Discharge okay? If not rescinded within 60 days after the discharge Antecedent debt of less that 600 are not preferential! Secured payments (90 days and 120 for insiders) are NOT preferential Rule 504: securities must be sold in a 12 month period Insurance companies do not go into bankruptcy voluntarily or involuntarily Disclaimer of Sale is made at the same time or before the sale Broke something? Can get workers comp, but cant sure for negligence Credit against unemployment rate? That the lessor of the state or federal NOT FICA: interest in municipal bonds, dividends, and capital gains Social Security: includes all but MEDICAID Sale or return? Risk of loss is with buyer until goods are returned to the seller Get the contract price of the goods if they dont pay. Not how much it cost to make Adult must keep up with a contract. Only a minor can disaffirm anytime they want! Unilateral mistake? And the person KNEW it was an error, it can be rescinded.

The employer deducts unemployment and Workers Comp Ship C.O.D. right to reject nonconforming goods OSHA doesnt develop safety equipment Fair Labor? Some included in minimum wage but exempt from overtime ENTRUSTS GOOD? Then accidentally selling is ok Merchants good faith? Observe the commercial standards for the fair dealing of trade Firm offer: made by merchant in writing ERISA: regulate vesting and plan funding DONT HAVE TO SAY THAT THE PERSON WAS RECKLESS for innocent misrepresentation UCC: cant get back up to $500 for the buyers breach Purchase money security interest Default on loan? Can reduce the claim Instrument not negotiable: if its subject to or contingent upon Minority of the maker: Infancy Car dealer exempt from filing currency transactions in the Bank Secrecy Act of 1970 Bearer paper can be negotiate by mere delivery Limit common carrier liability when contract is reasonable Promise to pay: Two Parties Trade acceptance: Three Party (seller orders the buyer to pay) Commercial paper? No warehouse or bills of lading Security agreement? Signed by debtor Negotiable? Date and location is not required Release collateral? Cant get payment Warehouse lien must NOT be negligent Warehouse and Bill of Lading is negotiable with a bearer or order to Debtor paid more than 60% of the goods; the creditor MUST sell in 60 days

Drawer: secondarily liable Tender of performance by principal releases the surety Best perfect lien? Have possession of the goods Perfected first wins over attachment Married filing jointly: MUST BE MARRIED Dont have kids? You are single for the next year if your spouse dies Spouse dies? Still considered married in that year j