Partnership Liability Question

Who has liability for partnership actions during the period Tina assumes management duties in Aon Enterprises?

1) Aon Enterprises only

2) Mark only

3) Tina only

4) Mark and Tina

Final answer:

During the time a limited partner assumes management duties in a limited partnership, both the limited partner and the general partner could share liability for partnership actions, due to the limited partner potentially losing their protection against personal liability. Thus (option 3) is the right answer.

Explanation:

The question revolves around the liability of partners in a limited partnership during the period when a limited partner assumes management duties. In a limited partnership, a general partner has unlimited personal liability for partnership actions, while limited partners typically enjoy protection against personal liability for partnership debts beyond their investment in the partnership.

However, if a limited partner like Tina takes on an active management role, she may be at risk of losing her limited liability protection and could be treated as a general partner for liability purposes during that time. Since Mark is a general partner, he retains his usual liability status. Therefore, most likely both Mark and Tina would share liability for partnership actions during the period Tina assumes management duties. Thus (option 3) is the right answer.