Question

Tailoring experts Frieda Oglesby, Rena Fitts, and Will Bertrand decide to go into business together. Their business, FitzWellby, is a business that provides in-home measuring and fittings and even on-site stitching to busy executives who don't have time to take their clothing to tailor shops.

Since all three have the same skills, they plan to share the profits of the business equally. At first, Oglesby believes that their business is unlikely to be sued for any reason—after all, they're just providing in-home services. Fitts points out that one of the three could accidentally damage a client's personal property or, more likely, an expensive piece of clothing. Oglesby is quickly convinced.

Which type of partnership would be right for FitzWellby: general, limited, limited liability, or joint venture? Explain your response

Answer 1

Limited Liability Partnership would be right for FitzWellby because in the limited liability partnership, all partners have limited liability. In this type of partnership, all partners can pool their resources and save money by sharing their knowledge and expertise. One of the advantages of this type of partnership is that, any partner involved in wrongful or negligent acts are personally liable for his conduct, but other partners stay protected and are not liable for those wrongful acts.

In our case, Oglesby, Fitts and Bertrand decide to do a tailoring business together, as there is risk of suing for any reason, the trio decided to form a partnership. Here, the limited liability partnership best suits them because any partner involved in wrongful act are personally liable for his conduct, no other partner will not be responsible for this wrong act. For example, if any one of them is accidentally responsible for the damage of a client's personal property or an expensive piece of clothing, that person is only liable for his conduct. As the trio have same skills they can take the help of each other when somebody is not well. They also decide to share profits as they have same skills, so to avoid any kind of disruption they need to form a partnership, i.e., limited liability partnership.