Question

Is a stipulation that excludes one or more partners from any share in the profits or losses valid?

1) True
2) False

Answer 1

A stipulation that excludes one or more partners from any share in the profits or losses of a partnership is valid in a general partnership.

Step-by-step explanation:

A stipulation that excludes one or more partners from any share in the profits or losses of a partnership is valid in a general partnership. One disadvantage of a general partnership is that partners are responsible for each other's acts and debts. However, partners in a general partnership can agree to a stipulation that limits or excludes one or more partners from sharing in the profits or losses in order to mitigate their personal liability.