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QUESTIONS:

1.A sold to B, one of the managing partners of Partnership X, the other being C, a certain number of mining claims without the consent of C. In an action by A to recover the unpaid balance of the purchase price against Partnership X, C claims that the contract is not binding upon the partnership for the reason that under the articles of partnership, there is a stipulation that one of the partners cannot bind the firm by a written contract without the consent of the others. Is the transaction made by B binding upon the partnership? Explain.

Answer:

2.Which of the following partners is NOT allowed to participate in the management of a partnership? a. Capitalist partner

b.Industrial partner

c.Nominal partner

d.Managing partner

Answer:

3.Which of the following rules of partnership management is NOT observed when the manner of management has not been agreed upon?

a.All the partners shall be considered agents of the partnership or all of them are managers.

b.Whatever any of the partners may do alone shall bind the partnership.

c.In case of opposition of the other partners, the decision of the majority shall prevail and the decision of the partners owning the controlling interest shall prevail in case of tie.

d.Any of the partners may make any important alteration in the immovable property of the partnership without the consent of the others if it may be useful to the partnership.

Answer:

4.How shall the profits and losses of the partnership be distributed among the partners? a. It should be divided equally.

b.It should be divided according to their profits and losses sharing agreement.

c.It should be divided proportionately in accordance with capital contribution.

d.It should be divided according to what type of partner they are.

Answer:

5.In the absence of agreement as to the sharing of profits, how shall industrial partner share with it?

a.The industrial partner shall first receive a just and equitable share in the profits before distribution to capitalist partners.

b.The industrial partner shall share on the basis of loss agreement ratio.

c.The industrial partner shall receive an equal share in profit.

d.The industrial partner shall receive the lowest share received by a capitalist partner.

Answer:

6.Which of the following rules of partnership management is NOT observed when a partner has been appointed as manager in the articles of co-partnership?

a.The managing partner may execute all acts of administration despite the opposition of his partners unless he acts in bad faith.

b.With just or lawful cause or if the managing partner acts in bad faith, the revocation of the power of the managing partner can be made by the vote of the partners representing the controlling interest.

c.Without just or lawful cause or if the managing partner acts in bad faith, the revocation of the power of the managing partner can be made only with the consent of all the partners including the managing partner.

d.The managing partner's decision on acts of administration may be reversed by the vote of majority of the partners.

Answer:

7.Which of the following partners is prohibited in engaging in businesses other than the partnership he is involved in?

a.Capitalist partner

b.Industrial partner

c.Nominal partner

d.Managing partner

Answer:

8.Which of the following stipulations in the sharing of profit or losses is valid?

a.A stipulation excluding a capital partner in the share of profits

b.A stipulation excluding a capital partner in the share of losses

c.A stipulation excluding an industrial partner in the share of profits

d.A stipulation excluding an industrial partner in the share of losses

Answer:

9.What is the remedy of the capitalist partner if the industrial partner engages in business for himself without the express permission of the partnership?

I.Exclude him from the partnership with a right to damages.

II.Avail themselves of the benefits obtained from the business he engaged in with a right to damages. a. Either I or II

b.Neither I nor II

c.I only

d.II only

Answer:

10.What are the remedies available to injured partners when a capitalist partner engages in the same kind of business without stipulation, allowing him to engage in that business?

I.To ask the guilty capitalist partner to bring to the common fund any profits accruing to him from the said transaction

II.To ask the guilty capitalist partner to bear all the losses from the said transaction a. Either I or II

b.Neither I nor II

c.I only

d.II only