PARTNERSHIP PART 2

In a partnership, the firm name clause must legally include the names of all partners involved, and failure to do so can result in the partnership being deemed invalid.

• TRUE

• FALSE

If a partnership agreement includes a duration clause, the partnership automatically dissolves once the specified period ends, even if the partners wish to continue the business.

• TRUE

• FALSE

The provision of capital clause in a partnership agreement dictates that each partner must contribute an equal amount of capital to the business, regardless of their role or ownership interest.

• TRUE

• FALSE

The partnership property clause ensures that any property purchased by the partnership is owned jointly by all partners, even if only one partner made the purchase.

• TRUE

• FALSE

A partnership agreement that includes an expulsion of members clause allows the majority of partners to expel a partner without cause, provided that the partnership agreement permits it.

• TRUE

• FALSE

Jane is the managing director of a company. The company's constitution explicitly states that she has the authority to enter into contracts on behalf of the company up to RM100,000 without needing approval from the board. Jane enters into a contract worth RM120,000 without board approval. Is the company bound by the contract?

• Yes, because Jane is the managing director.

• No, because Jane exceeded her actual authority.

• Yes, because the third party believed Jane had authority.

• No, because the contract amount was not specified in the company’s constitution.

Alex is an employee of XYZ Ltd. He does not have actual authority to sign contracts, but he often does so with the knowledge of the company's directors, who never object. One day, Alex signs a contract with a supplier for the purchase of office equipment. The supplier later discovers Alex lacked actual authority and seeks to enforce the contract. Is XYZ Ltd. bound by the contract?

• Yes, because Alex had apparent authority.

• No, because Alex lacked actual authority.

• Yes, because the supplier relied on the contract in good faith.

• No, because the directors never explicitly granted Alex authority.

Sophia is appointed as the general manager of a retail store. Traditionally, general managers in this industry have the authority to order stock without seeking approval from the owners. One day, Sophia orders an unusually large quantity of stock without prior approval. The owners of the store later question the order. Is the store bound by Sophia's decision?

• Yes, because Sophia has actual authority.

• No, because Sophia exceeded her actual authority.

• Yes, because general managers usually have the authority to make such decisions.

• No, because Sophia should have obtained approval due to the large quantity.

Michael, an agent for a real estate company, has always been allowed to negotiate rental agreements for properties managed by the company. However, the company did not expressly grant him this authority. Michael negotiates a rental agreement that is less favorable than usual. Can the company challenge the validity of the agreement?

• Yes, because Michael lacked actual authority.

• No, because Michael had usual authority.

• Yes, because the terms were less favorable.

• No, because usual authority does not apply here.

An employee of ABC Corp, commits a criminal act by bribing a government official to secure a contract for the company. Can ABC Corp be held criminally liable for the employee's actions?

• Yes, because the employee acted within his apparent authority.

• No, because the act was not benefited the company.

• Yes, because the act was committed to benefit the company.

• No, because criminal liability cannot be transferred to the company.