Question: Walton, Sr., the sole owner of a small retailing business, was trying to purchase some goods on credit from a manufacturer with whom he had not done business formerly. In talking in person with the manufacturer's representative, Walton pointed to his daughter, Waltona (a nationally recognized retailer who was as well visiting for a few days). Walton then stated that: "my partners and I have always paid our bills on time." Waltona heard and saw what her father had stated and done, however she made no comment in the presence of the manufacturer's representative. The manufacturer's representative knew, though, that Waltona was neither her father's partner nor or else involved in business with him. The manufacturer thereafter sold Mr. Walton goods on credit and Walton failed to pay for them when payment was due. When the partnership has no assets, and the manufacturer sues Waltona and Walton under such facts, against whom (if anyone) will it be successful?
Question: Barry, Victor, and Greg form a partnership which sells diet supplements to athletes. Greg spends far more time working in the business than do the other two partners. How could partners arrange to pay Greg a salary?
Question: John, Al, and Michelle are partners in the pizza restaurant. John owes Shark Finance Co. a great deal of money. Can Shark join to any partnership property? How could John arrange to pay off Shark from his partnership profits? What could Shark do to attempt to seek repayment via John’s interest in the business?
Question: Ally is a partner in the accounting firm. Can Ally accept after-hours tax and accounting clients as a sideline business?
Question: Bob, Caryl, Ted, and Alice formed a partnership to operate a restaurant called "Our Town." They each contributed funds and/or equipment for use in the restaurant, and Ted contributed an employed van he already owned. Several months later, Ted "borrowed" the van to take it on vacation. He claims he has the right to employ partnership property so long as it benefits at least one party. Is he right?
Case Problem:
Gershunoff, Silk and Oliker became equivalent partners in a business designed for the syndication and management of apartment houses. They never executed a written agreement setting forth the term of partnership. Afterward, when Oliker voluntarily withdrew from the partnership, Gershunoff and Silk continued to run the business, acquiring new assets and incurring latest obligations. For the subsequent two and one-half years, the parties met on many occasions to discuss the financial details of Oliker’s withdrawal. Lastly, Oliker demanded that the business be liquidated and that he be paid a one-third interest in the partnership assets at the time of termination. The Silk and Gershunoff argued that Oliker’s interest must be based on the value of partnership at the time of dissolution and must not comprise the raise in partnership property which occurred throughout the two and one-half years after his withdrawal. May Oliker now compel liquidation and receive one-third of the assets at the time of termination?
Short Answer Questions:
Question: Sharon, Sandy and Linda wish for to form a corporation for the floral shop that they are planning to open. They are confused concerning the differences among the articles of incorporation and the bylaws. Briefly distinguish between articles and bylaws. Which of such would control more of the day-to-day operations of the corporation?
Question: Tammy is a promoter for Acme Co. Briefly describes Tammy’s duties as a promoter. Also explain Tammy’s liability to the corporation and to the third parties. Is the corporation needed to pay Tammy for her services as a promoter?
Question: Under what circumstances might the court decide to pierce the corporate veil?
Question: Harold, Hillary and Heidi form a close corporation for their cleaning business, Happy Cleaners. What are some of the primary features of a close corporation?
Question: Johnny Walker wants to start up a pet walking service in the New York City. He intended to incorporate the business, however as his business was so successful, he never got around to dealing with all paperwork. Beneath the proposed incorporation, he was to be the sole shareholder of the corporation. Last week, one of Johnny’s client’s dogs broke loose from the pack and knocked over Peter Pedestrian, causing severe injury. What are the consequences to Johnny?
Case Problem:
Following the death of L. E. Ward in the year 1969, his widow, three children and a grandson formed a corporation for the purpose of holding the family farmlands. Leroy Ward controlled 50 percent of the corporation, Ward Farms, Inc. Throughout the life of the corporation; numerous conflicts existed between Leroy and the other shareholders. The corporation had never declared a dividend. The shareholders instituted some lawsuits regarding the corporation. Leroy had been enjoined from entering the property despite his control of 50 percent of the corporate stock. Leroy petitioned the court to dissolve the corporation on grounds that it was deadlocked and its assets were being wasted.
Should the corporation be dissolved by the court?