Asked by Timothy DeKorver on Jun 10, 2024
Verified
In Lach v.Man O'War,LLC,the case in the text,why did the court hold that the general partners were not required to comply with the requirements for conversion?
A) A new LLC was formed and the limited partnership dissolved.
B) The partners did not owe a fiduciary duty to one another.
C) The partners were unable to carry out the business due to extenuating circumstances.
D) The partnership agreement contained a conversion clause.
General Partners
Individuals in a partnership who have full liability for the debts of the partnership and take part in managing the business.
Conversion Clause
A provision in a contract or policy allowing for the change of one form of benefit or contract to another, such as converting from a term to a whole life insurance policy.
Fiduciary Duty
The obligation to act in the best interest of another party, such as a trustee's duty towards the beneficiaries of the trust.
- Acquire knowledge on the procedural steps essential for mergers and conversions concerning limited partnerships and LLCs.
Verified Answer
AO
Alondra OrozcoJun 17, 2024
Final Answer :
A
Explanation :
The court held that the general partners were not required to comply with the requirements for conversion because a new LLC was formed and the limited partnership dissolved.However,the court found that the general partners breached their fiduciary duty by transferring the assets of the limited partnership to the LLC without the consent of a limited partner.
Learning Objectives
- Acquire knowledge on the procedural steps essential for mergers and conversions concerning limited partnerships and LLCs.