Law of Business Enterprises Summary

Partnerships Overview

• A partnership is a legal relationship formed through a contract between two or more individuals, aimed at mutual profit.
• Partners contribute resources to a jointly managed business for collective benefit.

Characteristics of Partnerships

• Comprises 2 to 20 partners.
• Business objectives are material or patrimonial.
• Involves an associative element where members actively work together.
• No formal registration required.
• Formation can be oral or written and may be informal or even non-existent.
• Partnerships can be established tacitly through agreements.

Legal Nature/Theories of Partnerships

• Entity Theory: Treats the partnership as an independent entity, continuing despite changes in membership, with its own rights and obligations.
• Aggregate Theory: Considers partnerships as contractual associations; membership changes dissolve the partnership. Rights and assets are shared among partners in undivided shares.

Effects and Types of Legal Theories

• Changes in partners lead to partnership dissolution, resulting in either a new enterprise or liquidation.
• Personal capacity holds assets and liabilities, with exceptions.

Types of Partnerships

• Universal vs. Particular Partnerships:

  • Universal partnerships involve all property or profit contributions with proportional sharing indefinitely.
  • Particular partnerships are temporary, focused on specific projects with limited shared profits.

• Ordinary vs. Extraordinary Partnerships:

  • Ordinary partnerships hold all partners jointly liable for debts.
  • Extraordinary partnerships limit liability for certain partners, with subcategories including:
    • Anonymous Partnership: Partners share in business without public disclosure, limiting liability to internal agreements.
    • Partnership en Commandite: Partners not publicly disclosed contribute a fixed amount, sharing profits but limited to their investment for losses.
    • Special Partnership: Includes general partners (fully liable) and special partners (limited liability), who cannot engage directly with third-party transactions.

Essentialia of Partnerships

• Minimum elements distinguish partnerships from other agreements.
• Courts evaluate intention and presence of essential elements to determine partnership validity.

Partnerships Overview

• A partnership is a legal relationship formed by a contract among two or more individuals to operate a business for mutual benefit and profit.

Characteristics of Partnerships

• Comprises 2 to 20 partners.
• Focuses on material or patrimonial objectives.
• Involves associative workings among partners.
• No formal registration required.
• Can be established through oral or written agreements.
• May be informally formed or can exist without formal formation.
• Typically established via tacit contracts.

Legal Nature/Theories

• Entity Theory: Suggests partnerships have independent existence, own rights, and obligations that persist despite changes in membership.
• Aggregate Theory: Views partnerships as contractual associations, where rights, assets, and obligations are held jointly; changes in partners dissolve the partnership, leading to new entities.

Types of Partnerships

• Universal Partnership: Partners contribute all property or profits, generally established for undefined purposes with wide-ranging agreements.

  • Universorum bonorum: Commonly found in marriage contexts where all present and future property is pooled.
  • Commercial Universal Partnerships: Partners agree that all acquisitions during the partnership will be treated as partnership property.

• Particular Partnership: More defined and temporary, focusing on specific projects with limited shared profits.

• Ordinary Partnership: Partners share joint liability for all debts of the partnership.

• Extraordinary Partnership: Limits liability for some partners.

  • Forms include:
    • Anonymous Partnership: Conducted under one partner's name; anonymous partners have no liability to third parties.
    • Partnership en Commandite: Involves undisclosed partners contributing fixed sums; liabilities extend only to these contributions in case of loss.
    • Special Partnership: Comprises general partners (jointly and severally liable) and special partners (limited liability, contributing specific amounts).

Essentialia of Partnerships

• These are minimum elements distinguishing partnerships from other agreements.
• Courts assess the presence of these elements and the parties' intentions to determine partnership validity.

This quiz offers a summary of the Law of Business Enterprises, focusing on partnerships. Learn about the definition, characteristics, and important aspects of partnership agreements formed for profit. Ideal for students in their first semester.