Question

James was a partner in a large firm. He died unexpectedly. His son, Frank, wanted to take over for his father in the partnership and was well qualified to do the work his father had done. Which statement best describes Frank's rights in the partnership if he inherits the interest?

a. Frank has a right to take over for his father in the partnership.
b. Frank is entitled to the value in the partnership, but not to become a full partner.
c. Frank has no rights to his father's partnership interest.
d. Frank cannot be a full-fledged partner, but he can vote on firm matters.

Answer 1

Frank is generally entitled to the economic value of his father's partnership interest but does not automatically gain the right to become a full partner in the firm. Instead, that would require the consent of the existing partners.

Step-by-step explanation:

The rights of Frank, as an inheritor of his father's partnership interest, depend on the terms of the partnership agreement and the partnership law of the jurisdiction in which the firm operates. Typically, inheritance of a partnership interest does not automatically confer the right to become a full partner in the firm. Instead, Frank would generally be entitled to the value in the partnership that his father had, such as a share of the profits and/or the assets, but he would not have the right to take over his father's role in the firm without the agreement of the existing partners.

Therefore, the most accurate statement regarding Frank's rights is: b. Frank is entitled to the value in the partnership, but not to become a full partner. This is because, without a previous agreement, the surviving partners are not obliged to admit a new partner, especially not by mere virtue of inheritance. Frank may negotiate with the current partners to join the firm, but he does not have an automatic right to do so.