LAW 122 Lecture Notes - Lecture 6: Limited Liability Partnership, Sole Proprietorship, Limited Partnership
2 Feb 2017
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Types of business organizations: investment: corporations. Liability and benefits of entrepreneurs and other stakeholders differ depending on type used. No separation between business and proprietor (owner): Disadvantages: unlimited personal liability, money raised only by person borrowing, both problems grow as business grows. Laws generally applicable to businesses apply to sole proprietors, such as: provincial registration for business name. Only if name other than personal name: business licence may be required. A partnership exists when two of more people carry on business together with a view to a profit. Partnership creation automatic when relationship begins: no formalities are required. Sharing profits (not just revenues) or losses. Holding each other out as partners or acquiescing. Engaging in ongoing activity rather than one project. Income to partnership is person income to partners: provides default rules, which can be supplemented or modified by partnership agreement. Each partner can commit the partnership to obligations.
