As a student in a Creative Photography Diploma program, Lena became acquainted with two of her classmates: Beth and Peter.Beth and Peter were cousins who had emigrated from Eastern Europe with their extended families, several years earlier.Lena was, herself, an immigrant from South Asia, and so the three of them had some common ground:the shared experience of a new country as well as their career choice.

In their final semester, Peter told Lena of his idea for a business after graduation: a Portrait Studio that would serve various ethnic communities, using photographers that could all speak more than one language.He explained how he and Beth could target customers from their native country while Lena, could be a partner targeting her own South Asian customers.Peter told about studio space he had found at a reasonable rent and pointed out that between the three of them they already had more than sufficient equipment.He said that each of them could keep the money from the business that they brought in and that they would split all of the expenses three ways.

Lena was enthusiastic and agreed to the idea, in principle, but she said they would have to work out the many details of their partnership.Peter agreed, but said that for the next few weeks, they would all have to concentrate on making sure that all three of them got their diplomas.

A few days before the end of the semester, Peter announced to Lena that he had signed a lease on the studio they discussed.He explained that someone else had been trying to lease it, so he had quickly made a deal with the landlord at a slightly higher rent than they originally expected.He said that Beth felt he had done the right thing and he asked of Lena: "are you still in?"

She assured him that she was but suggested that the three of them immediately go to a lawyer and get a partnership agreement drawn up.Peter argued that there was no point in going to that expense when the business might never really get going."Let's just see if the idea works and then if it seems we can make money, we'll make everything official".

Lena decided to go along with this, realizing that there were bound to be a few problems as the new business got started.And problems there were, starting with Peter going out and buying a sign for the business that said: "'Round the World Photography" in large blue illuminated letters.Lena complained that he had no right to name the company on his own, but Peter countered that he felt it was fair since he personally had paid for the sign and was going to let the business pay him back only when it was profitable.Beth backed her cousin on this one, so Lena let the matter drop.There were a few other issues (Peter had ordered a new mobile phone and had purchased some advertising the others had not approved) but Lena decided not to get into petty arguments for the good of the business.

From the beginning, business was good.Surprisingly, the largest share of the business was coming in from Lena's South Asian community and she was soon working fifteen hour days to handle her clients.Because of this, she was less involved with the overall business decisions and had to trust Peter and Beth to handle the bookkeeping and expenses.

One day, four months after opening, Peter introduced Lena to a young man from Lena's native country.Peter explained that he had hired the young man, an experienced photographer, on a salary basis, to handle some of the growing South Asian business that was becoming too much for Lena to handle on her own.Flabbergasted, Lena said that she wished to speak to Peter and Beth in private.

Angry, Lena told Peter that he had no right to make hiring decisions without consulting his partners and that she wanted to immediately clarify this and other issues of authority in a written agreement.

Peter countered that he did have the right since, technically, he was the only owner of the business.He had registered the business in his own name, he explained.As well, he had signed the lease and he personally owned the trademark on the company name.When Lena looked to Beth for support, Peter intervened saying that Beth planned to leave the business soon anyway, in order to work for her father.All of this came as a shock to Lena.

Peter tried to reassure Lena saying that he would stand by their agreement that she could keep all of the revenue for customers she personally dealt with, minus a fair share of the overhead. But, he pointed out, he would be the one to determine what constituted a "fair share" and that any business serviced by his new employee (or any other South Asians he might hire) would belong to the company.

"Don't worry," Peter said, as he patted Lena on the back, "you're still going to make lots of money".

1.What mistakes did Lena make?

2.What legal position is Lena in?

3.What should she do now?

4.Why might this trio have been unsuitable as a partnership anyway?