Partnership Contracts
Wally and Beaver were general partners in a car dealership. Using the partnership name, Wally entered into a contract to purchase 30 used cars from Car Lots. Car Lots was not aware that Wally was not authorized to enter into this type of agreement. When the cars were delivered, Beaver refused to accept the cars. Car Lots wants to enforce the contract.
Each party will view this situation and the likely outcome to be different. What are the best arguments for Car Lots? What are the best arguments for the car dealership? After examining the facts and the various legal arguments on behalf of each party, make a final determination as to which party is most likely to win if this case were to go to court. Be sure to base your conclusions on your analysis taking into account the facts provided, reasonable assumptions and the relevant law (as opposed to listing your personal opinion).
Week 1 Assignment 3 Scenario 2- Pierce the Corporate Veil
Answered a question, supporting the response with appropriate cases, laws, and other relevant examples.
William Rich is an extremely wealthy entrepreneur who has owned several businesses. William sold some of the businesses while
others failed and ended up in bankruptcy. Most recently, William incorporated DSM with himself as the sole shareholder. He invested $5,000 in the company as a capital contribution. DSM then purchased 1,000 acres of land for $500,000 with the intent to develop an upscale subdivision. Nine months later, DSM became unable to pay its bills. As one of DSM's creditors, your business seeks to pierce the corporation and hold William personally liable for the company's debts.
Will your business be successful in holding William liable for DSM's debts? What information is important when conducting this type of investigation?
Explain the best legal and ethical arguments to hold William liable and then explain the best counter arguments in this situation (the arguments that William would make to deny liability). Explain your conclusion after your analysis is completed.