Partnership Formation No partnership has been established – Court’s Factors: Intention of Parties Profit Sharing Sharing of Losses (Risk) Management (Control) Ownership of Property (Control) Rights of Parties on Termination/Dissolution Conduct/Holding Out to Third Parties Factors Partnership Employment Express/Writing Intention of Parties Yes (RUPA § But might be wages (RUPA § 202(c)(3)(ii)) 202(c)(3)) Profit Sharing No Fenwick has all the risk; Chesire did not – Sharing of Losses invest $ No Fenwick has all the control/managerial – Management Only Fenwick had ownership rights Ownership of Property Rights of Parties on Looked like simple employment termination, 10 Termination/Dissolution days’ notice With limited exception, not held out as partners Conduct/Holding Out to Parties Partnership Formation Partners v. Lenders to be Lenders, not partners – – Also Cargill Difference is that Cargill actually exercised control – Factors Partnership Lenders Express/Writing Intention of Parties Yes (RUPA § 202(c)(3)) But be interest on loan (RUPA § Profit Sharing 202(c)(3)(v))
Partnership Formation – No partnership has been established Court’s Factors: Intention of Parties Profit Sharing Sharing of Losses (Risk) Management (Control) Ownership of Property (Control) Rights of Parties on Termination/Dissolution Conduct/Holding Out to Third Parties Factors Partnership Employment Intention of Parties Express/Writing Profit Sharing Yes (RUPA § 202(c)(3)) But might be wages (RUPA § 202(c)(3)(ii)) Sharing of Losses No – Fenwick has all the risk; Chesire did not invest $ Management No – Fenwick has all the control/managerial Ownership of Property Only Fenwick had ownership rights Rights of Parties on Termination/Dissolution Looked like simple employment termination, 10 days’ notice Conduct/Holding Out to Parties With limited exception, not held out as partners Partnership Formation – Partners v. Lenders – to be Lenders, not partners Also Cargill – Difference is that Cargill actually exercised control Factors Partnership Lenders Intention of Parties Express/Writing Profit Sharing Yes (RUPA § 202(c)(3)) But be interest on loan (RUPA § 202(c)(3)(v))
Business-Associations-Pollman-20152.docx