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Business Law - Coggle Diagram
Business Law
Agency
Creating an agency relationship: one person, a principal, assents to another person, an agent, to act on the principal's behalf. The agent must also assent to act.
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The employer has the right to control the details of the conduct of its employee as to the result and the means of the result
Tort Liability
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Principal v Agent
Agents have duty of Care, Obedience, & Loyalty
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Corporations
Formation
Promoter Liability: promoters personally liable as an agent for pre-incorporation contracts. Corporation not liable for any pre-incorporation contracts unless it assumes liability.
Defective Incorporation
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Corporation by estoppel: creditor who has always dealt with the principals as if they were a corporation is estopped from later alleging that the corp is defective.
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Directors, Officers, and Shareholders' Rights and Responsibilities
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Directors: Manage the corp and protected from liability by Business Judgment Rule - rebuttable presumption that directors are honest, well-meaning, and acting through informed decisions.
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Issuance of Stock
Every corp must authorize and issue at least one class of common stock and may authorize multiple classes of preferred stock
Shareholder's Preemptive Rights: right to acquire unissued shares in the corp in proportion to their holdings of the original shares when the corp seeks to issue additional stock
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Partnership
Creation
General Partnership: an association of multiple people to carry on as co-owners a business for profit. No writing required
Limited Partnership:contribute capital and share in profits, but take no part in the control or management of the business, and whose liability is limited to their contributions. Requires at least one general and one limited partner
Working Life
Partner's Powers: every partner is an agent, not entitled to renumeration unless specified, and jointly & severally liable.
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