Aoki, Biton, and Chiba are each one-third owners of ABC LLP. ABC is organized in a state that has adopted RUPA verbatim. ABC's partnership agreement provides, among other things, as follows: "No partner shall, without the prior written consent of the other two partners, (i) borrow money on behalf of the partnership except in the ordinary course of partnership business; or (ii) make or incur any expenditure on behalf of the partnership in excess of $50,000." ABC's business consists of owning and operating three gas stations.

Unbeknownst to Aoki and Biton, Chiba buys a new 2016 top-of-the-line Cadillac Escalade in the name of ABC for $78,000. She trades in her 2000 Saturn LW for $1,000 and finances the $77,000 balance through a loan from the dealership in the name of the partnership. Chiba then promptly skips town in her new ride, never to be heard from again. Neither Aoki, Biton, nor ABC had any contact or dealings with the car dealership.

 Assume you represent ABC. What arguments would make as to why ABC is not obligated on the loan? 

Answer rating: 100% (QA)

As ABCs representative you could make the following arguments to demonstrate that ABC is not obligated on the loan for the 2016 Cadillac Escalade purc... View the full answer