Business Law Tst 4 Flashcards Preview

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Flashcards in Business Law Tst 4 Deck (29)
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1

Agency relationship

Association between one party and agent who acts on behalf of that party

2

Expressed Agency

Agency created in a written or oral agreement

3

Implied Agency

Not written but implied through conduct of the parties

4

How to tell difference between implied and express agency?

See how 3rd party views it

5

Ratification

Acknowledge the action of agent by principle. Must take all actions can’t pick and chose

6

Express authority

Directly told to take action.
Told to sell house

7

Implied authority

Because you have the right to do specific actions (sell house) you may have other authority too (like show house, contact home owners)

8

Disclosed Principal

3rd party aware dealing with agent. Knows who principal is. Agent not liable principle liable contractually.

9

Partially Disclosed Principal

3rd party think he’s dealing with agent. Doesn’t know who principal is. Agent maybe liable and principal is liable contractually.

10

Undisclosed Principal

3rd party is unaware they are dealing with an agent. Both agent and principal are liable for contracts.

11

Types of principal tortious conduct

Respondeat superior= Latin for “let superior speak” principal held liable for harm done by agent

Negligent Hiring
Companies may also be held liable for intentional torts committed by agents

12

Principal duty to agent

Compensation
Indemnification= reimbursements for any thing lost by agent on principal behalf
Cooperation
Safe working conditions

13

Agents duties to principal

Loyalty
Notification
Performance
Obedience
Accounting

14

Termination of agency relationships

Lapse of time
Fulfillment of purpose
Occurrence of specific event

15

Some proprietorship

Just a dude doing business

16

Partnership

Voluntary association between 2 or more people

17

Types of partnerships

General- share unlimited personal liability of partnership debts
Limited Partnership- one general partner and one limited one who isn’t responsible for debts of business
Limited Liability Partnership- both partners only responsible to the extent of partnerships assets

18

LLC

Unincorporated business that is taxed like a partnership with members paying personal income taxes. And has limited liability of a corporation

19

Corporation

Legal entity formed by issuing stock to investors who are the owners of the corporation

20

How to form corporation?

File with Secretary of State office, stock holders are able to buy and sell stocks.

21

Who elects board of directors in a corporation? What do board of directors do?

Stock holders elect board of directors. Directors run business and make decisions, and hire officers to carry out Day to day tasks.

22

Duties of directors and officers

Duty of care
Loyalty
Disclose conflict of interest

23

Duties of shareholders

Not oppress minority share holders

24

Liability of directors and officers

Torts and crimes
Business Judgement Rule

25

Liability of share holder

Only liable for the amount invested

26

Rights of directors

Compensation
Participation and inspection
Indemnification (reimbursement for legal fees)

27

Officer rights

Any thing listed in employee contract

28

Shareholder rights

Dividends
Preemptive rights to buy new stock first
Stock Certificates
Transfer shares

29

How are profits paid in LLC

Depends on type
-Sole proprietorship flows through to owner
- Partnership is divided by parters as listed in partnership agreements
- Coorporations is given in dividends