Agency, partnership, and corporate law concepts tested on the bar exam.
40 cards · basic cards · AI-written, checked twice. Edit anything.
- What are the three types of agent authority?
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Actual authority (express or implied), apparent authority, and authority by estoppel.- An agent acts with express actual authority when doing what?
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Acting within the scope of authority explicitly granted by the principal, whether oral or written.- Does implied actual authority require written documentation?
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No. Implied authority arises from the principal's conduct and the customs of the industry, not from written grant.- What is apparent authority based on?
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What a reasonable third party would believe about the agent's authority based on the principal's manifestations.- Can a principal be liable for an agent's tortious acts?
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Yes, under respondeat superior, if the tort occurs within the scope of employment and the agent is an employee (not independent contractor).- When is an agent liable on a contract to a third party?
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When the agent lacks authority or fails to disclose the principal, or if the principal is undisclosed or partially disclosed.- What is the key requirement for partnership formation under the UPA?
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An association of two or more persons to carry on as co-owners a business for profit.- What are the default liability rules for general partners?
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Each general partner is jointly and severally liable for all partnership debts and torts.- Can a partner transfer their partnership interest without the consent of other partners?
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A partner can transfer their economic interest (distributions), but not their management rights, without consent.- When is a dissociating partner liable for partnership debts incurred after dissociation?
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The partner is not liable for debts incurred after dissociation, but remains liable for debts incurred before, unless the partnership was dissolved.- What is the fiduciary duty that partners owe to each other?
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The duty of care (to act in accordance with partnership agreement and not engage in gross negligence), duty of good faith and fair dealing, and duty of loyalty (no self-dealing).- How are profits and losses allocated in a partnership by default?
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Equally among all partners, regardless of capital contributions, unless the partnership agreement provides otherwise.- What is required to form a corporation?
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Filing articles of incorporation with the state, which creates a separate legal entity.- What is the shareholder liability rule?
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Shareholders are liable only up to their investment (limited liability); they are not liable for corporate debts.- When will a court pierce the corporate veil?
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When the corporation is a mere instrumentality used to commit a fraud, promote injustice, or circumvent existing legal obligations, and equity requires piercing.
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