QUESTION ONE
Tess, Fran, and Taylor have formed a general partnership, “TFT,” to engage in business providing home interior decorating services. Although they have a written partnership agreement, the agreement does not discuss division of profits or losses among the partners; nor does it discuss how the partnership will be managed. It does provide that the partnership will last for five years. The partners contributed cash as partnership capital as follows: Tess contributed $30,000; Fran contributed $45,000; and Taylor contributed $25,000. The Uniform Partnership Act (1997) (“UPA”) applies in their state. Answer each of the following questions, explaining your answers and citing any UPA provisions that support your answers:
(1) Last year the partnership made profits of $200,000. The partners decided to retain $50,000 in the partnership for future expansion, and distribute the remaining profits. How will the remaining $150,000 be divided among them?

(2) Without the knowledge or consent of the other partners, Tess engaged the services of a marketing company to promote the partnership’s business. Upon learning of this when the marketing company sends its initial bill for services, Fran and Taylor are not happy about what Tess did without telling them. They angrily tell Tess that she must pay the bill herself. Who is liable for payment of the marketing company’s bill? Why?

(3) Tess believes that it is important for TFT to diversify its business. She approaches Fran and Taylor with the idea of providing outdoor landscaping services in addition to their home interior decorating services. Fran agrees with Tess. But Taylor says no. He says that outdoor landscaping is not something they would be good at and is “just not their thing.” Taylor insists that they stick with their interior decorating services. The partners will vote on whether to expand their business. What result? Will TFT expand? Why or why not?