I found your answer to LA1Q1 very well written and through. The disadvantage that I find the most challenging is that of unlimited liability. Owen will be “personally liable for all the business’s debts and obligations” (The legal and ethical environment of business, 2014, pg. 350). However, this does not just include debts and obligations such as loans, money received for future services, and contractual obligations. As we have seen in the numerous case briefs so far in this class regarding negligence and the various other torts, Owen will have to be very careful in how he conducts business. Owen’s business would not be the only asset he would lose if he were to be found liable in a court case following some mere accident. All of his personal assets would be at stake as well. This could not only dissolve his business but his personal assets as well.
I did not agree with your analysis of LA1Q2. Flip’s relationship to Great States Trucking LLC ended and therefore the association ended. Dissolution is when, for any reason, …show more content…
Alpha committed fraud while contracting for paper to print the book, which was directly related to the joint venture and therefore both parties are liable (Clarkson, K., Miller, R., & Cross, F. (2010), pg. 729). Beta committed fraud while pursuing business that was personal to Beta and was not related to the joint venture, therefore Alpha will not incur liability for this tort.
Finally, LA2Q2 was a little difficult for me as well. Although “all members of an LLC are entitled to participate in its management”, in the event of a dispute, the parties will have to resolve it through litigation or arbitration. Not having an exhaustive operating agreement will make dispute resolution amongst the members very difficult (The legal and ethical environment of business, 2014, pg. 366). In the absence of state statutes regarding LLC’s, it will be up to the courts to render such