Tom and Jerry operate an ice cream business as equal partners. Tom wants to reinvest
the profits, and Jerry wants to distribute and spend the profits. If they litigate, the court
will likely order the business assets sold, which will destroy the income potential for
both Tom and Jerry. Discuss how this dispute might be resolved by arbitration.
Chris, Miller, and Kacy created a limited liability company by filing the articles of
organization, appointing a statutory agent, and paying the appropriate filing fee. They
also agreed to run the LLC themselves, making it a member-managed LLC. Chris
entered an agreement whereby he purchased 1,000 barrels of oil. Neither Miller nor
Kacy believe that Chris paid a good price for the oil. Nevertheless, Chris argues that the
LLC is bound by the contract he entered. Is Chris correct? Explain.
Small Bank mistakenly dishonors a $5,000 check written by its customer, Wanda, to
Hyram Real Estate as a down payment for a new home. As a result of the dishonor,
Wanda's closing is delayed by thirty days. She incurs $500 extra rental expenses,
$1,000 in attorney's fees and home mortgage interest rates increase by one half percent
before her closing. Hyram deposited the $5,000 check in its account and suffered $300
in NSF charges when credit for the deposit was withdrawn. Discuss the liability of
Small Bank to Wanda and Hyram.