Question
Three men, Dewey, Cheatham, and Howe, form a partnership, DCH Associates.The business will do commercial leasing and run a dry cleaning business.Only the UPA or
Three men, Dewey, Cheatham, and Howe, form a partnership, DCH Associates.The business will do commercial leasing and run a dry cleaning business.Only the UPA or the RUPA governs the partnership, or common law where neither Act addresses the matter (i.e., the partners have not entered into an agreement that deviates from that law).Discuss the outcome of each scenario, explaining your conclusions.
1) The men discover a property on the market that would make an ideal location for both businesses and they decide to purchase the property.
- By law, how can they take title? Do their options differ depending on whether the partnership is governed by the UPA or RUPA?
2) Anticipating that the business will be successful, the men consult an attorney about how the profits will be taxed.
- What advice does the attorney give them? Does the advice differ depending on whether the partnership is governed by the UPA or RUPA?
DCH Associates opens for business but soon various mishaps begin to occur.
3) Cheatham enters into a contract with Crapple to purchase three Mac computers on credit for the office, one for each man. Dewey and Howe hate Macs; they are PC users, and never would have purchased Macs for themselves.
- Who is liable on the contract? To what extent and why?Does your answer differ whether the partnership is governed by the UPA or RUPA, and if so, how?
- If Crapple must file a lawsuit to enforce the contract, whom should be named as the defendant/defendants? Does your answer differ whether the partnership is governed by the UPA or RUPA, and if so, how?
4) Cheatham fails to file some commercial lease paperwork for Chris Client and the Client loses $50,000 as a result.
- What is the extent of Dewey's, Howe's, and/or DCH's liability and why? Does your answer differ whether the partnership is governed by the UPA or RUPA, and if so, how?
- If a lawsuit is filed, who should be named as the defendant/defendants? Does your answer differ whether the partnership is governed by the UPA or RUPA, and if so, how?
5) Client comes to DCH's location to demand $50,000 compensation from Cheatham and an argument ensues. Cheatham shuts the door in Client's face, catching Client's finger in the door jam and breaking it.Client then files a personal injury lawsuit.
- Whom should Client name as a defendant/defendants in the suit? Does your answer differ whether the partnership is governed by the UPA or RUPA, and if so, how?
- If Client wins the lawsuit, who is responsible for compensating Client for her injuries, how much are they responsible for paying, and why? Does your answer differ whether the partnership is governed by the UPA or RUPA, and if so, how?
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