entrepreneur
a person who forms and operates a new business either by himself or with others
sole proprietorship
a form of business in which the owner is actually the business; the business is not a separate legal entity
general partnership
an association of two or more personal to carry on as co-owners of a business for profit
general partners
persons liable for the debts and obligations of a general partnership
Uniform Partnership Act (UPA)
a model act that codifies partnership law. Most states have adopted the UPA in whole or in part.
partnership agreement
a written agreement that partners sign, also called articles of partnership
right to participate in management
a situation in which, unless otherwise agreed, each partner has a right to participate in the management of a partnership and has an equal vote on partnership matters.
indemnification
the right of a partner to be reimbursed for expenditures incurred on behalf of he partnership
duty of loyalty
a duty that a partner owes not to act adversely to the interests of the partnership
duty of care
the obligation partners owe to use the same level of care and skill that a reasonable person in the same position would use in the same circumstances. A breach of the duty of care is negligence.
duty to inform
a duty a partner owes to inform his or her co-partners of all information he or she possesses that is relevant to the affairs of the partnership.
duty of obedience
a duty that requires partners to adhere to the provisions of the partnership agreement and the decisions of the partnership.
action for an accounting
a formal judicial proceeding in which the court is authorized to (1) review the partnership and the partners' transactions and (2) award each partner his or her share of the partnership assets.
joint and several liability
tort liability of partners together and individually. A plaintiff can sue one or more partners separately. If successful, the plaintiff can recover the entire amount of the judgment from any or all of the defendant-partners who have been found liable.
joint liability
liability of partners for contracts and debts of the partnership. A plaintiff must name the partnership and all of the partners as defendants in a lawsuit.
partnership for a term
a partnership created for a fixed duration.
partnership at will
a partnership created with no fixed duration.
dissolution
the change in the relation of the partners caused by any partner ceasing to be associated in the carrying on of the business
winding up
the process of liquidating a partnership's assets and distribution the proceeds to satisfy claims against the partnership
wrongful dissolution
a situation in which a partner withdraws from a partnership without having the right to do so at that time
