Which of the following best describes the term 'partnership by estoppel'?

A partnership formed without a formal agreement
A partnership that is legally recognized despite not meeting all legal requirements
A partnership that is dissolved due to one partner's actions
A partnership that is formed only for tax benefits

Which of the following best describes the term 'partnership by estoppel'?

Step 1: Understand what a partnership is. A partnership is when two or more people work together in a business.
Step 2: Learn about 'estoppel'. Estoppel is a legal term that prevents someone from arguing something different from what they have previously stated or agreed to.
Step 3: Know that 'partnership by estoppel' happens when someone acts like they are a partner in a business, even if they are not officially one.
Step 4: Realize that when this person acts like a partner, others may believe they are part of the partnership.
Step 5: Understand that because of this belief, the law may recognize them as a partner, even if they didn't officially join the partnership.

No concepts available.