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Source Partner Authority and Liability Complete South Dakota Bar Exam Topic Index List Matched to this deck.

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After a business relationship breaks down, owners, managers, and outsiders dispute who is bound and who must pay. Two founders shared profits while telling a creditor that only one founder was responsible. One argument was preserved, while another was raised only later. The parties disagree about the legal effect of those facts. Which option gives the best analysis?

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The court should resolve the dispute by applying the operative rule to the material facts: The answer should identify the governing rule for Partner Authority and Liability and apply it to the operative facts. Resolve the dispute on equitable fairness alone without identifying the governing doctrine or its limits. Import a rule from a nearby issue instead of applying the rule triggered by these facts. Reject the claim or defense solely because the opposing party disputes a required fact.

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