Question 4 (a)

LLP as a hybrid of company and partnership

9.375 marks

Time to write
About 19 minutes

From an older CBCS paper

Question

Question 4 (a) · 9.375 marks

Q.4. Between a company and a traditional partnership, LLP is a hybrid. Comment.

Reworded from the university paper; the task is the same. The original paper belongs to the University of Delhi. See DU's question bank.

Before you write

Read off the question and its marks

19 minfor 9.4 marks

Read from the question

  • CommentA statement to judge: take a stand on it in your first line, give your reasons, and come back to it at the end.

What the paper leaves open

The paper prints no mark per question (any four of six, equal marks, 75 in all); each question is reckoned here at 18.75 marks. Marked as one question of 18.75 marks; answered here in 2 parts of 9.375 marks each (marks inferred).

Write it in this order

  1. Read; underline the asks; jot your points 1 min
  2. 1 LLP as a hybrid 9.4 marks 17 min
  3. Check: every ask answered, key terms underlined 1 min

Try it first. About 19 minutes for 9.375 marks. Write it out, then open the solution.

Solution

Hover or tap a marked figure, like 72,000, to see how it is made and where else it appears.

LLP as a hybrid. The statement is correct. An LLP takes some features from each form:

Picture itLLP as a hybrid of company and partnership

1The firm's debt reaches the house: the sofa and the TV ride away on the creditor's truck.

Partnership firmUnlimited, extending to the partners' personal assets.

2Under an LLP only the office desk goes; the couple watch from their own gate, home untouched.

LLPLimited to the agreed contribution, except in wilful fraud.

  • From the company: it is a body corporate, a legal entity separate from its partners, with perpetual succession; and each partner's liability is limited to the contribution he has agreed to bring.
  • From the partnership: its partners arrange its internal structure by their own mutual agreement, as partners of a firm do, which keeps it flexible and its compliance cost low.
  • Its own rule on agency: a partner binds the LLP by his own acts but does not bind his fellow partners, unlike a firm, where each partner binds the others. Because it carries elements of both a corporate structure and a partnership structure, the LLP is described as a hybrid of the two.

Where the 9.375 marks sit

#ComponentMarks
1LLP as a hybrid9.375
Total9.375
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