Lloyd Is a Partner in an Ordinary Partnership Firm in the Business

question 42

Multiple Choice

Lloyd is a partner in an ordinary partnership firm in the business of providing tax services.While serving a client on behalf of the partnership,Lloyd's partner Janet intentionally understates the client's taxable income on a federal tax return.When the true income is reported a few years later,the client is required to pay a penalty.The client sues the partnership and its partners.Which of the following is correct?

• A) Janet is not liable to the client because she was acting on behalf of the partnership.
• B) Lloyd is not liable to the client,unless he authorized Janet to understate the client's income.
• C) The partnership is not liable to the client because the intentional tort is outside the scope of business.
• D) Janet is not liable to the client because she was acting in the ordinary course of business.

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