Ben Small, a Sole Practitioner, Has Just Decided to Form

question 80

Multiple Choice

Ben Small, a sole practitioner, has just decided to form a law partnership with his lifetime friend, Harvey Steptoe. They agree to name the firm Steptoe and Small and to split all profits. Ben is also a director for a publicly-traded telecommunications firm, NewVector, Inc. Ben has just learned that Harvey is lead counsel is a lawsuit against NewVector. Ben continues to serve as a board member and participates in sensitive discussions about the lawsuit. Ben does not disclose that Steptoe is his partner. Ben's feeling is that he and Harvey are as honest as the day is long and neither would compromise their duties to NewVector and client, respectively.

• A) Ben has a conflict of interest and must either resign as a director or leave the partnership.
• B) The pledge of both Ben and Harvey is sufficient to cover the ethical issues on conflict.
• C) It is Harvey's obligation to take action, not Ben's.
• D) None of the above

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Definitions:

Capacity To Contract

The legal ability of a party to enter into binding contracts, typically requiring legal age and mental competency.

Agent

An agent is a person or entity authorized to act on behalf of another person or entity, known as the principal, in legal or business matters.

Legally Enter

The act of gaining access or entry to a property, system, or situation in accordance with the law and authorized permissions.

Contract

A contract is a legally binding agreement between two or more parties that outlines obligations each party must perform.