University:
Toronto Metropolitan University
Course:
LAW 122 | Business Law
Academic year:

2022
Views:

487

Pages:

1
Author:

Pierre C.

Partnership Law Principles Agency a relationship that exists between two or more parties when one person is agent, who is considered at law to represent the other, the principal in such a way that the agent can affect the principal’s legal position (making contracts, disposing of property) principal becomes bound by the contract (and agent is not a party) 3 necessary ingredients: (i) Consent by the principal and the agent (ii) Action by the agent on behalf of the principal (iii) Control by the principal (determines what things the agent can do on their behalf) • • Businesses are persons, but cannot do anything without agents acting on their behalf Important that agent discloses to third party that they are acting on behalf of principal, so that the contract is not formed between rogue agent and third party Sole Proprietorships • least expensive form of business, money is important; no specific legislation o 2 sections in Partnership Act (88 and 89), must register name if you do not want it to be your own name • income tax applies, but applies to everything so not really mentioned in course o do not need to share profits with anyone (unless you have borrowed) o no duties to consult with anyone, vote, etc. o when you die, your SP dissolves, does not continue on § people who rely on services like to have continuity • unlimited personal liability – creditors can come over your personal assets o insurance becomes important • really easy to change to a corporation from an SP (to save from tax, and other benefits) Partnerships • relationship between people, not a separate entity still • Need two or more ‘persons’ (can be humans or corporations) • 2+ persons must be carrying on business together with a goal to make a profit o Do not actually have to make a profit, but must be for the purpose of making a profit • Partnership can be implied, does not have to be written o Also, can alter the sections of legislation that apply through contract • 3 kinds: general partnerships, limited partnerships, and limited liability partnerships o most small business partnerships are GP – responsible for all debts • biggest disadvantage is still the liability, joint liability – sections 11/12 of the Act [ADD condensed partnerships stuff]