BUSI 301 LU Type of Business to Be Formed a Limited Liability Company Case Study

Peter and Andrew are brothers. Since childhood, they have wanted to convert a barn on their grandfather’s farm into a hunting and fishing lodge that would provide modest but comfortable accommodations for sportspersons using nearby recreational lands. Andrew has suggested that they bring his friend, Paul, into the business, as well. While Peter and Andrew would develop the property, Paul has experience in the hospitality industry and could manage the day-to-day operations. Peter and Andrew would also want to make the lodge available to local church groups for worship retreats. They haven’t yet discussed this with Paul, because they know he is not comfortable with most churches and their positions on social issues. The men are now discussing how to form the new business, and have narrowed their choices to a general partnership or a limited liability company (LLC). What would you advise, and why? Consider and discuss issues such as:

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What personal liability will the owners have for the obligations of the business (contracts, debts, lawsuit judgments, etc.)

Should Paul be included as a co-owner, or in some other role? On what do you base that decision?

  • How would contributions to the new business of skills, experience, labor, etc. be valued when determining percentages of ownership (i.e., how would you assign monetary value  to them to calculate percentages of ownership) ?
  • How would profits and losses be distributed?
  • Title your thread “General Partnship” or “LLC” to indicate your conclusion.
  • Suggested Reading:
  • 2 Corinthians 6:14–18 (For this passage, you should consult some trusted exegetical commentaries, many of which may be found on www.ccel.org.)

    BUSI 301
    DISCUSSION GRADING RUBRIC
    Content 70%
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    Advanced
    Key
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    Components – All key components of the
    Thread
    discussion prompt are
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    answered in the thread. The
    required length and citation
    requirements are met.
    Discussion Thread – Levels of Achievement
    Proficient
    Developing
    7 to 8 points
    Most key components of
    the discussion prompt are
    answered in the thread. The
    required length and citation
    requirements are mostly
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    7 to 8 points
    Components – Contribution made to
    Marginal contribution made
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    discussion with each reply
    to discussion with each
    (10 points)
    (2) expounding on the
    reply (2) marginally
    thread; replies are posted on expounding on the thread;
    different days. The required replies are posted on
    length and citation
    different days. The required
    requirements are met.
    length and citation
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    1 to 6 points
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    the discussion prompt are
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    required length and citation
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    minimal or only 1 reply)
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    are posted on the same day.
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    discussion. The required
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    requirements are not met.
    Page 1 of 4
    BUSI 301
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    pertinent, conceptual, or
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    assumptions, analyzing
    implications, and
    comparing/contrasting
    concepts); at least 2
    scholarly source
    citations, in addition to
    the course textbook, in
    current APA format; and
    integration of at least 1
    biblical principle with
    citations.
    18 to 22 points
    Major points are
    supported by most of the
    following: Reading &
    Study materials;
    pertinent, conceptual, or
    personal examples;
    thoughtful analysis
    (considering
    assumptions, analyzing
    implications, and
    comparing/contrasting
    concepts); at least 2
    scholarly source
    citations, in addition to
    the course textbook, in
    current APA format; and
    integration of at least 1
    biblical principle with
    citations.
    1 to 17 points
    0 points
    Major points are
    supported by some of the
    following: Reading &
    Study materials;
    pertinent, conceptual, or
    personal examples;
    thoughtful analysis
    (considering assumptions,
    analyzing implications,
    and
    comparing/contrasting
    concepts); at least 2
    scholarly source citations,
    in addition to the course
    textbook, in current APA
    format; and integration of
    at least 1 biblical
    principle with citations.
    Major points are
    supported by none of the
    following: Reading &
    Study materials;
    pertinent, conceptual, or
    personal examples;
    thoughtful analysis
    (considering
    assumptions, analyzing
    implications, and
    comparing/contrasting
    concepts); at least 2
    scholarly source
    citations, in addition to
    the course textbook, in
    current APA format; and
    integration of biblical
    principles.
    Page 2 of 4
    BUSI 301
    Major
    Point
    Support Replies
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    Structure
    30%
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    Grammar/
    Spelling Thread
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    23 to 25 points
    Major points are supported
    by all of the following:
    Reading & Study materials;
    pertinent, conceptual, or
    personal examples;
    thoughtful analysis
    (considering assumptions,
    analyzing implications, and
    comparing/contrasting
    concepts); at least 1
    scholarly source citations,
    in addition to the course
    textbook, in current APA
    format; and
    integration of at least 1
    biblical principle with
    citations.
    18 to 22 points
    Major points are supported
    by most of the following:
    Reading & Study materials;
    pertinent, conceptual, or
    personal examples;
    thoughtful analysis
    (considering assumptions,
    analyzing implications, and
    comparing/contrasting
    concepts); at least 1
    scholarly source citations,
    in addition to the course
    textbook, in current APA
    format; and
    integration of at least 1
    biblical principle with
    citations.
    1 to 17 points
    Major points are supported
    by some of the following:
    Reading & Study materials;
    pertinent, conceptual, or
    personal examples;
    thoughtful analysis
    (considering assumptions,
    analyzing implications, and
    comparing/contrasting
    concepts); at least 1
    scholarly source citations, in
    addition to the course
    textbook, in current APA
    format; and
    integration of at least 1
    biblical principle with
    citations.
    0 points
    Major points are supported
    by none of the following:
    Reading & Study materials;
    pertinent, conceptual, or
    personal examples;
    thoughtful analysis
    (considering assumptions,
    analyzing implications, and
    comparing/contrasting
    concepts); at least 1
    scholarly source citations,
    in addition to the course
    textbook, in current APA
    format; and
    integration of at least 1
    biblical principle with
    citations.
    Discussion Thread – Levels of Achievement
    Advanced
    Proficient
    6 points
    Correct spelling and
    grammar are used
    throughout the thread.
    There are no errors in
    grammar or spelling that
    distract the reader from the
    content.
    4 to 5 points
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    distract the reader from the
    content.
    Developing
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    grammar or spelling that
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    errors in the grammar or
    spelling that distract the
    reader from the content
    OR there is evidence of a
    complete lack of
    spellchecking and
    proofreading.
    Page 3 of 4
    BUSI 301
    Grammar/
    Spelling –
    Replies
    (6 points)
    6 points
    Correct spelling and
    grammar are used
    throughout the replies.
    There are no errors in
    grammar or spelling that
    distract the reader from the
    content.
    4 to 5 points
    There are 1–5 errors in
    grammar or spelling that
    distract the reader from the
    content.
    1 to 3 points
    There are 6–10 errors in
    grammar or spelling that
    distract the reader from the
    content.
    0 points
    There are more than 10
    errors in the grammar or
    spelling that distract the
    reader from the content
    OR there is evidence of a
    complete lack of spellchecking and proofreading.
    APA Format
    Compliance Thread
    (6 points)
    6 points
    References are cited both
    in-text and in a reference
    list. There are no errors in
    APA format in the required
    citations.
    4 to 5 points
    References are cited both
    in-text and in a reference
    list. There are 1-5 minor
    errors in APA format in the
    required citations.
    1 to 3 points
    There are more than 5 errors
    in APA format in the
    required items and/or
    required citations are
    missing.
    0 points
    Required citations do not
    exist, or demonstrate no
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    structure.
    APA Format
    Compliance Replies
    (6 points)
    6 points
    References are cited both
    in-text and in a reference
    list. There are no errors in
    APA format in the required
    citations.
    4 to 5 points
    References are cited both
    in-text and in a reference
    list. There are 1-5 minor
    errors in APA format in the
    required citations.
    1 to 3 points
    There are more than 5 errors
    in APA format in the
    required items and/or
    required citations are
    missing.
    0 points
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    exist, or demonstrate no
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    Word Count 3 points
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    The minimum word count
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    words.
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    words of substantive
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    of 100 words of substantive
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    Substantive word count is
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    TOTAL
    Instructor’s Comments:
    /100
    Page 4 of 4
    LEGAL STRATEGY 101
    Forum Shopping
    Page 103
    Silicon Valley.
    KiskaMedia/Getty Images
    Forum shopping refers to a common strategic tactic by plaintiffs in civil
    litigation. It occurs when a strategic plaintiff selects the most favorable
    legal forum in which to initiate a lawsuit.
    Forum shopping is often maligned and criticized, but it is a common
    legal strategy. In fact, forum shopping provides a good illustration of
    the preventive or risk-reduction legal strategy we saw at the end
    of Chapter 1: the proactive practice of anticipating potential legal risks to
    one’s business and taking preventive measures to reduce or manage
    those risks.
    By way of example, perhaps the single-greatest or looming legal risk that
    all businesses face is the threat of litigation, and a common legal strategy
    to address this risk is the use of well-drafted “forum selection clauses” in
    business agreements. Let’s take a look at a real-world instance of this
    preventive legal strategy.
    Consider a familiar website like Facebook. With over two billion active
    users, the threat of litigation is a daunting one. But to open a Facebook
    account in the first place, a user must agree to Facebook’s terms of
    service. (You can check out Facebook’s user agreement for yourself
    here: https://www.facebook.com/terms.) Among the many provisions
    in Facebook’s user agreement is the following forum selection clause:
    You will resolve any claim, cause of action or dispute . . . you have with us arising out
    of or relating to this [user agreement] or Facebook exclusively in the U.S. District
    Court for the Northern District of California or a state court located in San Mateo
    County, and you agree to submit to the personal jurisdiction of such courts for the
    purpose of litigating all such claims.
    In other words, because Facebook’s corporate headquarters are located
    in Menlo Park, California (in San Mateo County), and because the closest
    federal trial court is located in nearby San Jose, California (in next-door
    Santa Clara County), if a Facebook user ever wants to sue Facebook for
    any reason, he or she must do so in Facebook’s “back yard,” so to speak.
    Moreover, notice how this legal strategy not only helps a giant business
    firm like Facebook reduce its legal expenses by consolidating most of its
    litigation in northern California; it also guarantees Facebook “home
    court advantage” in cases involving out-of-state plaintiffs!
    Yes, the law is supposed to be applied impartially, and yes, courts are
    supposed to be fair and neutral, but in close cases, the benefit of securing
    home court advantage cannot be underestimated, especially in jury
    trials. In sum, because the risk of litigation is a real one, business firms
    may take strategic measures—such as incorporating well-drafted “forum
    selection clauses” into their business agreements before any litigation
    ensues—in order to channel litigation toward a favorable legal forum or
    secure home court advantage in the event of litigation.

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