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partnership :: legal definition


Partnership - n. a business enterprise entered into for profit which is owned by more than one person, each of whom is a "partner." A partnership may be created by a formal written agreement, but may be based on an oral agreement or just a handshake. Each partner invests a certain amount (money, assets and/or effort) which establishes an agreed-upon percentage of ownership, is responsible for all the debts and contracts of the partnership even though another partner created the debt or entered into the contract, has a share in management decisions, and shares in profits and losses according to the percentage of the total investment. Often a partnership agreement may provide for certain division of management, shares of investment, profit and/or rights to buy out a partner upon leaving the partnership or death. Each partner owes the other partners a duty of full disclosure of information which affects the business and cannot commandeer for himself/herself business opportunities which rightfully belong to the partnership. A partnership which does business under a trade name must file with the county or state a certificate of "doing business under a fictitious name," which gives notice to the public of the names of partners and the business address. A "limited partnership" limits the responsibility for debts beyond the investment to the managing "general partners." The investing "limited partners" cannot participate in management and are limited to specific percentages of profit. A partnership differs from a "joint venture," which involves more than one investor for only a specific short-term project and prompt division of profits. Partnerships are traditionally the most fragile of business arrangements and are often dissolved and subject to disputes. But several million exist in the United States and, ironically, they are the favorite business entity for law firms.

See also: general partner limited partnership partner silent partner and Related Law Terms ↓


Related Law Terms

account stated :: n. a statement between a creditor or the person to ... ending on the state. See also: debt
addendum :: n. an addition to a completed written document. Mo ... proposals or included fraudulently.
answer :: n. in law, a written pleading filed by a defendant ... emurrer general denial verification
appeal :: 1) v. to ask a higher court to reverse the decisio ... ng, as in "he has filed an appeal."
articles of incorporation :: n. the basic charter of a corporation which spells ... year's taxes. See also: corporation
Attorney General :: n. in each state and the federal government the hi ... izenry. See also: Solicitor General
bankruptcy :: n. a federal system of statutes and courts which p ... y proceedings trustee in bankruptcy
bargain :: n. 1) a mutual agreement or contract between two p ... o: agreement consideration contract
bottomry :: n. a mortgage contract in which a ship and/or its ... n sell the ship and/or its freight.
breach of contract :: n. failing to perform any term of a contract, writ ... breach breach specific performance
business invitee :: n. a person entering commercial premises for the p ... to the contrary. See also: invitee
capital gains :: n. the difference between the sales price and the ... so: basis delayed exchange exchange
carrier :: n. in general, any person or business which transp ... lso: common carrier private carrier
chattel mortgage :: n. an outmoded written document which made a chatt ... ed by the property. See also: UCC-1
child custody :: n. a court's determination of which parent, relati ... pport custody divorce joint custody
clean hands doctrine :: n. a rule of law that a person coming to court wit ... ices. See also: affirmative defense
commingling :: n. the act of mixing the funds belonging to one pa ... rust accounts for funds of another.
common area :: n. in condominium and some cooperative housing pro ... tage of total store space occupied.
common stock :: n. stock in a corporation in which dividends (payo ... oration preferred stock share stock
community property :: n. property and profits received by a husband and ... and distribution separate property
complaint :: n. the first document filed with the court (actual ... g prayer service of process summons
consumer protection laws :: n. almost all states and the federal government ha ... rranty product liability securities
contingent fee :: n. a fee to a lawyer which will be due and payable ... epend on the outcome are unethical.
contract :: 1) n. an agreement with specific terms between two ... n oral contract unilateral contract
contractor :: n. 1) a person or entity that enters into a contra ... actor mechanic's lien subcontractor
contribution :: n. 1) donation to a charity or political campaign. ... f $3,000 from each of his partners.
cooperative :: n. an association of individual businesses, farmer ... exes. See also: cooperative housing
copyright :: 1) n. the exclusive right of the author or creator ... plagiarism public domain trademark
corporation :: n. an organization formed with state governmental ... ation public corporation securities
covenant :: 1) n. a promise in a written contract or a deed of ... o compete deed restrictive covenant
d.b.a. :: n. short for "doing business as," when a person or ... that is registered with the state.
declaration of trust :: n. the document signed by a trustor (settlor) crea ... also: settlor trust trustee trustor
default judgment :: n. if a defendant in a lawsuit fails to respond to ... See also: complaint default summons
derivative action :: n. a lawsuit brought by a corporation shareholder ... on director shareholder stockholder
disbar :: v. to remove an attorney from the list of practici ... legal ethics. (See moral turpitude
doing business :: v. carrying on the normal activities of a corporat ... oration operating within the state.
ejusdem generis :: (eh-youse-dem generous) v adj. Latin for "of the s ... t was of land-based transportation.
element :: n. 1) an essential requirement to a cause of actio ... of action crime general plan zoning
express contract :: n. a contract in which all elements are specifical ... e circumstances. See also: contract
extreme cruelty :: n. an archaic requirement to show infliction of ph ... ring the suffering spouse (victim).
first degree murder :: n. although it varies from state to state, it is g ... aughter murder second degree murder
foreign corporation :: n. a corporation which is incorporated under the l ... tate or Whoopee's designated agent.
franchise :: 1) n. a right granted by the government to a perso ... on property, income or profits tax.
general appearance :: n. an attorney's representation of a client in cou ... case. See also: special appearance
general partner :: n. 1) usually one of the owners and operators of a ... ted partnership partner partnership
grace period :: n. a time stated in a contract in which a late pay ... the contract, i.e. your insurance.
grandfather clause :: n. 1) a clause in a statute or zoning ordinance (p ... Such laws are now unconstitutional.
hearsay rule :: n. the basic rule that testimony or documents whic ... interest dying declaration hearsay
impute :: v. 1) to attach to a person responsibility (and th ... also. See also: vicarious liability
incorporate :: v. 1) to obtain an official charter or articles of ... te by reference incorporation stock
insolvency :: n. 1) the condition of having more debts (liabilit ... the property. See also: bankruptcy
joint :: adj., adv. referring to property, rights or obliga ... ncy joint venture tenancy in common
joint and several :: adj. referring to a debt or a judgment for neglige ... ution contributory negligence joint
joint venture :: n. an enterprise entered into by two or more peopl ... s terminated. See also: partnership
jurisdiction :: n. the authority given by law to a court to try ca ... Superior Court Supreme Court venue
juvenile delinquent :: n. a person who is under age (usually below 18), w ... low as 14. See also: juvenile court
law :: n. 1) any system of regulations to govern the cond ... um maritime law natural law statute
liability :: n. one of the most significant words in the field ... bility joint tortfeasors negligence
libel :: 1) n. to publish in print (including pictures), wr ... libel per se public figure slander
limited liability :: n. the maximum amount a person participating in a ... ted damages partnership shareholder
limited partnership :: n. a special type of partnership which is very com ... mited liability partner partnership
living trust :: n. sometimes called an inter vivos (Latin for "wit ... thrift clause trust trustee trustor
Massachusetts Trust :: n. a business in which the investors give manageme ... provide for eventual distribution.
mechanic's lien :: n. the right of a craftsman, laborer, supplier, ar ... ll sue for the debt. See also: lien
mercantile law :: n. that broad area of the law (also called commerc ... tion seller Uniform Commercial Code
negligence :: n. failure to exercise the care toward others whic ... gence per se res ipsa loquitur tort
no fault insurance :: n: a type of automobile insurance required of car ... ling lawsuits. See also: negligence
non-profit corporation :: n. an organization incorporated under state laws a ... harity corporation cy pres doctrine
novation :: n. agreement of parties to a contract to substitut ... . See also: accord and satisfaction
officer :: n. 1) a high-level management official of a corpor ... deputy sheriff or federal marshal.
oral contract :: n. an agreement made with spoken words and either ... itten. See also: agreement contract
partner :: n. 1) one of the co-owners and investors in a "par ... ner limited partnership partnership
performance :: n. fulfillment of one's obligations required by co ... nce. See also: specific performance
plea :: n. 1) in criminal law, the response by an accused ... raignment plead preliminary hearing
pro rata :: (proh rat-ah or proh ray-tah) adj. from Latin for ... e year in which he/she holds title.
promise :: 1) n. a firm agreement to perform an act, refrain ... so: consideration contract covenant
promissory note :: n. a written promise by a person (variously called ... lso: interest obligee obligor usury
prosecute :: v. 1) in criminal law, to charge a person with a c ... rney General prosecution prosecutor
prospectus :: n. a detailed statement by a corporation required ... rporation limited partnership stock
prudent man rule :: n. the requirement that a trustee, investment mana ... (1994). See also: fiduciary trustee
reformation :: n. the correction or change of an existing documen ... neral partner sues for reformation.
regulations :: n. rules and administrative codes issued by govern ... es usually have similar procedures.
royalty :: n. a percentage of gross or net profit or a fixed ... also: copyright infringement patent
save harmless :: v. 1) also called hold harmless, to indemnify (pro ... . See also: hold harmless indemnify
securities :: n. generic term for shares of stock, bonds and deb ... ee also: bond debenture share stock
self-dealing :: n. in the stock market, using secret "inside" info ... ederal Securities and Exchange Act.
service of process :: n. the delivery of copies of legal documents such ... by publication substituted service
share :: n. 1) a portion of a benefit from a trust, estate, ... n issue of the corporation's stock.
silent partner :: n. a non-legal term for an investor who puts money ... partner limited partnership partner
speaking demurrer :: n. an attempt to introduce evidence during a heari ... the operation." See also: demurrer
specific legacy :: n. a gift in a will of a certain article or proper ... ecific bequest specific devise will
specific performance :: n. the right of a party to a contract to demand th ... artwork. See also: contract prayer
standing :: n. the right to file a lawsuit or file a petition ... so: actual controversy jurisdiction
statute of limitations :: n. a law which sets the maximum period which one c ... ies. See also: demurrer laches toll
stock certificate :: n. printed document which states the name, incorpo ... . See also: corporation share stock
tax :: n. a governmental assessment (charge) upon propert ... unified estate and gift tax use tax
trust :: n. an entity created to hold assets for the benefi ... testamentary trust trustee trustor
will :: n. a written document which leaves the estate of t ... will and testament probate testator

Popular Law Searches

legal definition ministerial act :: n. an act, particularly of a governmental employee ... exercising any individual judgment.
chancery legal definition :: n. a court that can order acts performed. Today ch ... ts in most states. See also: equity
testamentary disposition legal definition :: n. how the terms of a will divide the testator's ( ... named beneficiaries. See also: will
contract of sufferance :: n. a "hold-over" tenancy after a lease has expired ... y tenancy at will unlawful detainer
forthwith legal definition :: adv. a term found in contracts, court orders and s ... mediacy, with no excuses for delay.
forthwith definition legal :: adv. a term found in contracts, court orders and s ... mediacy, with no excuses for delay.
what is to wit in a legal contract :: prep. that is to say. Example: "the passengers in ... tty Bumgartner and Sherry Younger."
mirror wills legal definition :: n. the wills of a husband and wife which are ident ... d each names the other as executor.
clean hands doctrine latin :: n. a rule of law that a person coming to court wit ... ices. See also: affirmative defense
sine qua non only relates to contract law :: (see-nay kwah nahn) prep. Latin for "without which ... qua non of the injury to Playmate.

Other Law Terms - P

paid into court :: adj. referring to money deposited with the clerk o ... differences. See also: interpleader
pain and suffering :: n. the physical and mental distress suffered from ... l damages special damages suffering
palimony :: n. a substitute for alimony in cases in which the ... the relationship. See also: alimony
pander :: 1) v. to solicit customers for a prostitute. 2) n. ... ons or favors. See also: prostitute
panderer :: n. 1) a person who panders or solicits for a prost ... special interests. See also: pander
panel :: n. the list of people selected to appear for jury ... or jury duty. See also: jury venire
paper hanger :: n. slang for a person who criminally writes and ca ... ey in them. See also: forgery fraud
par :: n. 1) an equal level. 2) the face value of a stock ... common stock preferred stock stock
paralegal :: n. a non-lawyer who performs routine tasks requiri ... h less than that for the attorneys.
paramount title :: n. a right to real property which prevails over an ... n's claim of title. See also: title
parcel :: n. a defined piece of real estate, usually resulti ... See also: real estate real property
pardon :: 1) v. to use the executive power of a Governor or ... also: amnesty commutation reprieve
parens patriae :: (paa-rens pat-tree-eye) n. Latin for "father of hi ... pport custody divorce guardian ward
parent :: n. the lawful and natural father or mother of a pe ... natural parent. See also: adoption
parental neglect :: n. a crime consisting of acts or omissions of a pa ... usive or sexually predatory person.
pari delicto :: adj. equal fault. See also: in pari delicto ... al fault. See also: in pari delicto
parish :: n. 1) a geographic area served by a church (partic ... overnmental equivalent of a county.
parody :: n. the humorous use of an existing song, play, or ... l significance. See also: copyright
parol :: adj. oral. See also: parol evidence rule ... oral. See also: parol evidence rule
parol evidence rule :: n. if there is evidence in writing (such as a sign ... or contradict the written document.