Answer Guides - Partnership PDF

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ANSWER GUIDESPARTNERSHIP1 of Partnership – Section 7 (1)Persons i persons/ corporations ii – 20 (2)Carrying on i than preparatory – Smith v Anderson ii of acts – Smith iii transaction of intended many is considered carrying on – Re Griffin iv transaction for extended period counted – Canny v off ven...

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ANSWERGUI DES P ARTNERSHI P 1 .De fini t i onofPa r t ne r s hi p–Se c t i on7 ( 1 )Pe r s ons i .Na t ur alpe r s ons /c or por a t i ons i i .2–20 ( 2 )Ca r r yi ngon i .Mor et hanpr e par a t or y–Smi t hvAnd e r s o n i i .Re pe t i t i onofa c t s–Smi t h i i i .Fi r s tt r a ns a c t i onofi nt e nde dma nyi sc ons i de r e dc a r r yi ngon– ReGr i ffin i v .Onet r ans a c t i onf ore xt e nde dpe r i odc ount e d–Ca nny v .Oneoffve nt ur eofl ar ges c al ec ount e d–UDC vi .Me r epr e pa r a t or ydoe snotc ount–Pi o ne e rCo nc r e t eSe r vi c e s vi i .Be gi nt ot aker a w ma t e r i a l sa ndt ur noutpr oduc t-Kha n ( 3 )A bus i ne s s i .Se c t i on3–“ Anyt r ade , oc c upa t i onorpr of e s s i on” i i .Lookt opr ofitmot i ve ,s c a l eofac t i vi t y ,r e pe t i t i on,pe r mane nt c har ac t e r ,c ont i nui t y& s ys t e m –Ev a nsvFe de r a lCo mmi s s i o no f Ta x a t i o n ( 4 )I nc ommon i .“ I st hepe r s onwhoc a r r i e sont ha tbus i ne s sdoi ngs oa sa na ge nt f oral lt he pe r s onsal l e ge dt o be par t ne r s ? ” – La ng v J a me s Mo r r i s o n&CoLt d i i .Ac t i ver ol enotne c e s s ar y–ReRudd o c k i i i .I nt e nt i ont opr ot e c ti nve s t me ntnots ameasi nt e nt i ont oope r a t e –Ka ng Ke m i v .Mus tbec ar r yi ngont hes a mebus i ne s s–Che c k e rTa x i c a b ( 5 )Wi t havi e w ofpr ofit i .Mus tl i ea tt heve r yhe ar t–Bo va i i .Onl yi nt e nt i ont omakepr ofiti sne c e s s ar y 2 .Evi de nc eofPa r t ne r s hi p–Se c t i on8 ( 1 )J oi ntt e nanc y ,t e na nc yi nc ommon,j oi ntpr ope r t y ,c ommonpr ope r t y , par towne r s hi pNOTP ARTNERSHI P ( 2 )Sha r i ngofgr os sr e t ur nsNOTP ARTNERSHI P ( 3 )Re c e i ptofs ha r eofpr ofit s=pr i maf a c i ee vi de nc eofpa r t ne r s hi p ( 4 )Re c e i ptofde bt /mone yi ni ns t a l me nt sf r om t hepr ofit sofabus i ne s s NOTP ARTNERSHI P ( 5 )Cont r ac tf orr e mune r a t i onbys har eofpr ofit sNOTP ARTNERSHI P ( 6 )De c e as e dpa r t ne r ’ ss pous e /def a c t os pous e /c hi l dr e c e i vi nga nnui t y f r om pa r t ne r ’ ss ha r eoft hepr ofit sNOTP ARTNERSHI P ( 7 )Re pa yi ngal oanwi t hs har eofpr ofit sNOTP ARTNERSHI P

( 8 )A pe r s onr e c e i vi nga nnui t y/pr ofit si nc ons i de r a t i onofs a l e /goodwi l l NOP ARTNERSHI P 3 .Ri ght s&Dut i e sofaPar t ne r–Se c t i on34 ( 1 )Al lpa r t ne r st os har ee qual l yi nc api t a l , pr ofit s , a ndl os s e s ( 2 )Fi r mi nde mni fie spar t ne r sf r om pa yme nt smadeandpe r s onall i abi l i t i e s i nc ur r e d ( 3 )I nt e r e s ta t6% p. a . f orpa yme nt sbe yondc api t a lbypar t ne r ( 4 )Pa r t ne rnote nt i t l e dt oi nt e r e s tonc api t albe f or epr ofits har i ng ( 5 )Eve r ypar t ne rma yt a kepa r ti nmana ge me nt ,s hal la t t e nddi l i ge nt l yt o t hebus i ne s sandnotr e c e i ver e mune r a t i on ( 6 )Nope r s onma ybei nt r oduc e da spa r t ne rwi t houtc ons e ntofe xi s t i ng par t ne r s ( 7 )Anydi ffe r e nc ei nma t t e r soft heor di na r yc our s eofbus i ne s sma ybe de c i de dbyma j or i t yofpar t ne r s ( 8 )Pa r t ne r s hi pbookst obeke pta tpl a c eofbus i ne s s .Eve r ypa r t ne rha s a c c e s st oi ns pe c t&c opya nyoft he m ( 9 )No c ha nge i nc onduc t /r e gul a t i on wi t houtc ons e nt / aut hor i t y of ma j or i t y .Noc hangei nna t ur eofbus i ne s s /pl a c ewi t houtc ons e ntofa l l par t ne r s 4 .Expl a i nbi ndi ngna t ur e–Se c t i on26 5 .Li abi l i t y ( 1 )Ea c hpa r t ne ri sj oi nt l yl i abl ewi t ht heot he r s ( 2 )Li abi l i t yf orde bt s&obl i ga t i on–Se c t i on16 i .J oi nt l yl i abl e ( 3 )Li abi l i t yf orwr ongs–Se c t i on17 i .J oi nt l y&s e ve r al l y i i .Wa l k e rvEur o p e a nEl e c t r o ni c sPt yLt d ( 4 )Li abi l i t yf ormi s a ppl i c a t i onofmone y–Se c t i on18 i .J oi nt l y&s e ve r al l y i i .Ll o ydvGr a c e ,Smi t h&Co ( 5 )Li abi l i t yf or‘ hol di ngout ’–Se c t i on21 i. I ndi vi dual l yl i abl et ope r s ont her e pr e s e nt a t i onwasmadet o...