Question
Business is good in Hal and Sophia's restaurant. They take in another partner, Cindy . Their partnership agreement provides that all purchases over $3,000 must
Business is good in Hal and Sophia's restaurant. They take in another partner, Cindy. Their partnership agreement provides that all purchases over $3,000 must be authorized by two partners, and that only Sophia is able to authorize supplier payments. Unknown to Hal and Sophia, Cindy uses the partnerships account to order $7,500 of A5-grade Japanese Wagyu beef (which is the most expensive meat available) from Meat-A-Lot: Where the Steaks Are High! the restaurant's meat wholesaler and also buys on the partnerships credit a $3,500 bracelet from Bling, the jewellers next door to the restaurant, and also uses the partnerships account to buy $11,000 worth of wine from Bottomzup, the restaurant's liquor wholesaler. Prior to Cindy making these purchases, Hal told Bottomzup that Sophia is the only liquor buyer for the partnership. Sophia refuses to pay Meat-A-Lot, Bling and Bottomsup. All three sellers knew that Cindy, Sophia and Hal were partners in the restaurant. 1) Explain the partnership's liability if any to Meat-A-Lot, Bling and Bottomsup.
2) Explain Hal and Sophia's liability if any in the event that the partnership is unable to pay its liabilities.
3) Explain Cindy's liability if any to all parties in the scenario both in general and in the event of the partnership being unable to pay its liabilities.
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