Persons J, P, S, and F formed a company B to bid on the contract of construction. A clause mentioned in the contract, stated that 75 % of the votes are mandate for removing any member on the grounds of being guilty with felony. S told J, later on, when B achieved success, that she along with other members were planning to terminate him from superior majority votes without any appropriate reason for the same. J filed a suit against B and the other members. To find: Whether the LLC statute, fiduciary duties and operating agreements of B being breached by J.

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ETHICS Pete, an accountant, recommended that several of his clients invest in Competition Aircraft. These clients passed this recommendation on to Arlene, who did invest. Unfortunately, Competition was a fraudulent company that pretended to sell airplanes. After the company went bankrupt, she sought to recover from Pete. Is Pete liable to Arlene? Whether or not Pete faces legal liability, is it a good idea for accountants to recommend investments to clients? Does that practice create any potential conflicts of interest?

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Chapter 17, Problem 5BCP

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Case summary: Persons J, P, S, and F formed a company B to bid on the contract of construction. A clause mentioned in the contract, stated that 75% of the votes are mandate for removing any member on the grounds of being guilty with felony. S told J, later on, when B achieved success, that she along with other members were planning to terminate him from superior majority votes without any appropriate reason for the same. J filed a suit against B and the other members.

To find: Whether the LLC statute, fiduciary duties and operating agreements of B being breached by J.

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