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Legal Environment
PART I
1. The best option for me
When starting a business, the creation process, the aspects of control, owners' liability, and income taxation are some of the very significant elements needing consideration (Morgan, 2015).  Now that I have graduated, I will have to choose between three principal types of business including a sole proprietorship, a small franchise, or a small partnership. A sole proprietorship is the simplest type of business among the three because it can be started quickly, instantly, and perhaps inexpensively with minimal ongoing formalities if any. Notably, a sole proprietor is only entitled to pay his employees' unemployment tax and not his unemployment tax (Morgan, 2015). Also, it is easier to freely mix both personal and business assets as the owner of a sole proprietorship. The negative side of a sole proprietorship is that the owners remain subjected to personal liabilities for business losses and debts, and they cannot generate capital by the sale of an interest in the business. However, it is sporadic for a sole proprietorship to survive the owner's incapacity or death, implying that such a company cannot retain value. 
On the other hand, a partnership is a type of business automatically created when two or more people enter into business enterprise for profit. Just like a sole proprietorship, a partnership can be formed easily as well as inexpensively and they do not need annual meetings because of minimal ongoing formalities (Morgan, 2015). Also, a partnership provides a favorable form of taxation because they do not pay minimum taxes like in corporations. Everything has a drawback and all parties in a partnership are subject to unlimited personal liability for losses and debts, making this the partner is subject to tort and contract claims. This aspect makes the individual partners responsible for other partners' actions. As a result, disputes among owners may arise when the partnership is not correctly organized. Therefore, I plan to start with a sole proprietorship and graduate to the other two forms of business after the business picks up. 
2. Partnership agreement
Research shows that writing a partnership agreement is highly recommendable despite not being required. Given that two friends want to enter into a partnership regarding cleaning offices at night, their partnership agreement must have some significant aspects to avoid conflict and maintain profits. These aspects include their official names and the partnership's name, the duration and purpose of the partnership, each partner's contribution of capital, profits and loss sharing methods, the impact of advances if there are any payable salaries to the partners, the accounting method with the fiscal year, both liabilities and rights of the partners upon withdrawal or death, and the protocol to be followed upon dissolution (Morgan, 2015).  
3. Benefits & disadvantages of a limited investor in a Limited Liability Company (LLC)
Investing in a Limited Liability Company has both advantages and disadvantages because LLCs involves a combination of both partnerships' principles and liability protection benefits for a corporation. Such hybrid provides investors with more flexibility compared to a corporation, and also various tax flexibility benefits for a partnership. Foremost, an LLC investor is subject to the ownership benefits because an LLC may have as little as a member and as many members as it likes. Such advantages make an LLC to easily add a wide range of investors (Morgan, 2015). Also, LLCs are not subject to the Securities & Exchange Commission or public trading reporting when sold or bought. Therefore, members can choose to be directors and owners or not. 
LLC investors enjoy tax benefits because the company passes both losses and profits proportionally to its members. The company does not file its taxes, despite reporting its annual profits, revenues, and damages in an IRS form 1065. The fact that an LLC does not pay taxes makes it avoid business or corporate taxes and this increases the profit that is proportionally shared to the investors (Morgan, 2015). Notably, there are the liability protection benefits whereby the LLC investors remain indemnified from personal liability for the business's conduct unless they breach their fiduciary duties or commit illegal acts. Such limited liability is extended to protect the investors against the company's debt and lawsuits. 
On the contrary, LLC faces the problem of pass-through taxes. Even though LLC does not encounter double taxation, it incurs the pass-through taxation issue, indicating that both losses and profits are reported on every investor's tax return, whether an investor gets dividends or not (Morgan, 2015). Therefore, an LLC can be more appropriate for a specific owner's condition since investors might not embrace pass-through taxation. 
However, given the case Moseley Vs. Commercial State Bank, Moseley could have taken some significant actions to shield his assets as an investor. Overall, Moseley should have conducted a proper understanding of Southern Distilleries's Limited Liability Protection because it is a business entity that was legally separate from its investors. As a result, Moseley could have appropriately understood how such separation provided limited liability protection to investors to make sure that his assets are secure in case the business failed to pay its debts. Therefore, he could have asked for the company's business records like the annual statements and realize the debt in advance before agreeing.  
4.  Appeal to a financial rewards claim by Carrie Burkle
A new trial for Carrie's suit depends on various aspects to determine whether it should be granted or denied. Foremost, the issue of if a funds transfer served as a loan or a gift leads to questions of facts. Such questions are significantly based on Ronald's intention during the period he advanced the funds in acquiring the 1% interest by Carrie. In summary, in such a record, one cannot conclude that Roland met his burden of creating no triable issue of fact exists based on if such advancement of funds remained a loan or a gift. Therefore, a fact finder could logically infer- from the lack of any evidence of the loan terms, from Roland's failure in telling Carrie that he was only lending her the money she would be subjected to repay with interest, and also from the absence of a loan terms' agreement- that Ronald's intention was to give Carrie a gift during the time he started the investment for Carrie (Morgan, 2015). Therefore, the only loan evidence is Roland's saying that he contributed the capital for Carrie in the form of a loan. However, a trier of fact may disbelieve testimony by Ronald. 
Research shows that various aspects need to be featured in a limited company operating agreement to ensure there are no disputes between the family members. These aspects should use a similar mechanism that is common within a partnership agreement, including capital contributions, operations, members' roles, profit & loss distributions, and the dissolution process (Morgan, 2015).    
5. Tax considerations
Research shows that the general corporate form offers limited liability to all the owners. Therefore, given that the corporation is considered a separate entity from its shareholders for most of the functions, the law creates a reasonably sophisticated model whereby the corporation is entitled to operate- from the establishment to operation, and perhaps termination. Additionally, income to the corporation is subject to tax unless the corporation is established under Subchapter S (Morgan, 2015). As it is noted, a worldwide corporation income (non Subchapter S) passed over to investors as the dividend is taxed for a second time. Although there are avenues that investors can pursue in minimizing the double taxation effect, the possibilities generally remain fraught and complicated needing advice from both legal and accounting professions. However, an LLC provides an added advantage to the investor because it is easier to establish and run compared to a Subchapter S or a general corporation. Therefore, an LLC acts as a conduit for all the income to the entity such that there exists only one taxable activity (Morgan, 2015). Notably, an LLC has a method for losses to flow to the investors directly, which may be a beneficial tax condition for the owners. 
PART TWO
1. How the case illustrates the tort liability of partnerships 
The law gives a partner the power to impose tort liability on the partnership by the respondeat superior doctrine. Given that a partnership serves as the principle of all the acting partners like agents, the Law imposes tort liability on a partnership for all the wrongful acts or violations from any partner who acts in the normal process of the partnership and its benefits as well (Morgan, 2015). Additionally, every partner remains liable for the torts of the fellow partners. Such an outcome is evident since every partner is essentially a principle concerning the counterparts serving as agents.
2. The obligation for trust & loyalty 
As a fiduciary, every partner owes the undivided loyalty duty to the other. As a result, each partner must remain accountable to the partnership for each benefit and holding as a benefit trustee for the partnership of any profits realized by him/her without the other partner's consent (Morgan, 2015). However, there is a personal relationship in the partnership that obligates every partner to practice good faith as well as in considering the mutual welfare of the entire partners within the business conduct. 

Reference
Morgan, J. F. (2015). Business law. Redding, CA: BVT Publishing.
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