Partnership Problems
Response
Question One
The agreement between the three partners is not legally enforceable in court or a binding agreement. This is because of several reasons. Firstly, the agreement is not in writing a required in the Oregon Revised Statutes. Secondly, the agreement did not involve any lawyer or an accountant; thus it does not meet the requirement of creating a partnership as provided in ORS 67.055. The chapter provides that a partnership should be created under a predecessor statute or a comparable law of another jurisdiction. The chapter further provides that an entity created under laws not described in subsection (2) of the section is not a partnership. Lastly, the agreement does not meet some of the factors provided under ORS 67.055 that indicate whether partners are in a partnership. For example, only one partner agreed to contribute money to acquire the land rather that getting capital from all the three partners.
Question Two
The property is owned by the partnership. This is because the land was transferred to “Blue Sky Ventures” by using the right procedure immediately after the agreement. According to ORS 67.065, a property become the property of a partnership if it is acquired in the name of the partnership. As we can notice from the facts, the three partners transferred the property to the partnership in its name, hence owned by “Blue Sky Ventures”. However, this partnership involves general partners because one partner provides capital to acquire the land, the other provides skills on how to develop the land, and the last one provides skills about marketing and selling of the property. Therefore, every partners owns all the debts, losses, and judgment of the partnership regardless of which partners causes a loss as an individual or the organization as a whole.
Question Three
In Blue Sky Ventures, every partner has the responsibility to take control over the venture. According to ORS 67.090, each partners is an agent of the partnership for the purpose of the business. However, partners are limited to take control of all activities and purposes that they have authority to perform on behalf of the partnership in that activity.
Question Four
In the case of Blue Sky Ventures, the partners skipped a very significant step when forming a partnership. The three partners agreed that they is no need to consult or hire an accountant and a lawyer to help in documenting anything or agreement about the partnership. In class, it was explained that tax advisors, accountants, and lawyers are key aspects when creating a partnership. These experts and professionals are very useful when making decisions on whether to form a business entity or not. They also guide on whether the business will save money and time as a partnership or a sole proprietor. Lastly, professionals such as lawyers offer legal guidance as well as rules and regulations related to the business.