Question
Rachel and Lawrence are both general partners and operate a business where they sell face masks. Business is booming in 2020. In order to ramp
Rachel and Lawrence are both general partners and operate a business where they sell face masks. Business is booming in 2020. In order to ramp up production, they need to buy more equipment, but they do not have the money to purchase what they need. Brian decides to invest $30,000 into the business but he does not want to participate in the day to day operations, so he becomes a limited partner. Rachel and Lawrence enter a contract to supply masks to Corner Store, a local grocery store. Before they are shipped, they get a larger order for more money from a bigger grocery chain and Brian advises them that they should take it and he enters the business into a contract with the bigger grocery chain. Corner Store sues for breach of contract and obtains a judgment in the amount of $75,000, which it decides to pursue against Brian because he has the most money. Will Corner Store be able to pursue its judgment against Brian and on what basis?
Group of answer choices
a. Corner Store cannot enforce its judgment against Brian because he is a limited partner.
b. Corner Store can only enforce its judgment against Brian because he entered into the contract.
c. Corner Store can only enforce its judgment against the partnership.
d. Corner Store can enforce its judgment against Brian because he participated in management decisions and lost his protection of liability beyond his investment.
e. Corner Store can enforce its judgment against Brian, but because he is a limited partner, they can only get up to $30,000 from him and must claim the remaining amounts against either Lawrence or Rachel or both.
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