Know Your Business Association Entities
A Business Associations essay question has appeared on every bar exam incorporating the Multistate Essay Exam since July 2008 except for two administrations. That means Business Associations has appeared on 93% of bar exams since July 2008, so there’s a good chance that you will see an Agency, Partnership, or Corporations MEE essay question—either as a standalone question or combined with another subject.
One of the more frequently tested issues in Business Associations questions is whether a business entity has been formed, and if so, what kind of entity was formed, and at what point in time did that entity begin?
Typically, what happens in these questions is that the individuals want to create a certain kind of business entity, but for some reason, they failed to satisfy certain requirements necessary to create the lawful entity.
When you discuss the business entity formed, make sure you’re specific. For example:
As far as partnerships go, was the partnership a general or a limited partnership? Was the partnership at will or for a particular purpose or duration? Was the partnership a limited partnership or a limited liability partnership?
As far as corporations go, was the corporation formed as a de jure corporation (formed in accordance with the law)? If all corporate laws have not been followed, a de facto corporation might result or a corporation might be recognized through estoppel. And don’t forget about benefit corporations (B Corporations)—this was tested on the last exam.
As far as LLCs go, make sure you know the differences between member-managed LLCs and manager-managed LLCs. And if you don’t want to raise a red flag in your response, make sure you identify LLCs as limited liability companiesrather than limited liability corporations!
I went through all the past Agency, Partnership, and Corporations essay questions since 2008. Here are some of the calls of the questions that require you to discuss what business entity was formed, and when it began.
February 2021 (“1(a) Are the woman and the man partners in the food-truck business? Explain.”)
February 2019 (“1. What type of business entity is Radiology Services? Explain.”)
July 2018 (“1. When did Solar Inc. come into existence? Explain.”)
July 2016 (“1. What type of LLC was created—member-managed or manager-managed? Explain.”)
February 2011 (“1. When did Delta’s corporate existence begin? Explain.”)
July 2010 (“1. What is the legal relationship among Fran, Gina, and Hank? Explain.”)
July 2009 (“1. What type of entity is the Metropolitan Limited Partnership? Explain”)
