 Basics
1.      Principal – Agency Law
a.      Agency is a fiduciary relationship in which the agent shall act on the principal’s behalf
b.     Co-agents have agency relationships with the same principal
c.      4 different basis of liability of the principal to a third party via the agent
                                                             i.     Actual authority – the agent is acting on behalf of the principal
1.      Agent must manifest assent to act as the agent
2.      Principal must manifest assent to appoint the agent
3.      Authority ends when either party has knowledge of a revocation or renunciation
                                                           ii.      Apparent authority – third party reasonable believes that the agent has authority to act on behalf of the principal. This must be traceable to the principal’s actions.
1.      Ends when it is no longer reasonable for the third party to believe that the agent continues to act with actual authority
                                                         iii.     Respondeat Superior – principal is liable for torts of employees but not for the torts of independent contractors
                                                          iv.     Estoppel – third party must prove detrimental reliance. Principal had not made manifestation of assent to agent. Principal was passive responsible for third party’s erroneous belief
2.      Accounting
a.      Book value undervalues the partnership as a going concern because the partnership can generate profits
b.     Book value overstate liquidation value
Partnerships
1.      Creating the partnership
a.      A writing is required for any partnership that cannot be completed within a year in order to comply with SOF
b.     A partnership can be created without explicitly agreeing to one. The relevant question is whether the parties intended to act as co-owners of a business for profit
c.      A joint venture has a very limited scope
d.     Sharing profits constitutes prima facie evidence of a partnership
e.     Factors in finding a partnership
                                                             i.     Capital contributions
                                                           ii.     Responsible for losses by the firm
                                                         iii.     An agreement to share profits
                                                          iv.     Rights to assets upon dissolution
                                                            v.     Control and management
2.      Sharing Profits and losses
a.      Profits and losses are governed by NYPL 40
b.     If no agreement, partners share equally in profits and losses
c.      Total
nto only transactions designed to terminate rather than carry on the business.
                                                         iii.     There is no continuing liability on any partner after dissolution
                                                          iv.     Liability does exist on the business during the wind up phase
                                                            v.     NYPL 62– general dissolution rules
1.      62(2) –dissolution by breach
                                                          vi.     NYPL 63 – judicial dissolution – one party can request the court to dissolve
1.      A partner breaches, the business can only be carried on at a loss
2.      63(1)(f) – dissolution must be equitable to partner requested dissolution
b.     Wind up – no specific NYPL section
                                                             i.     All of the remaining business is to be completed and no new business is entered into
                                                           ii.     All assets are turned into cash
Windup ends in termination
