Business Associations on the bar exam

Business Associations is an essay subject that covers four related bodies of law: agency, partnerships, limited liability companies, and corporations. Questions usually begin with an authority or fiduciary duty problem rather than a formation problem.

The recurring structure is: who acted, did they have authority, whom does that bind, and did they breach a duty in doing so. Answering in that order produces a complete essay even under time pressure.

• Agency authority questions distinguish actual, apparent, and inherent authority, plus ratification.
• Fiduciary duty answers must separate the duty of care, the business judgment rule, and the duty of loyalty.
• Derivative suit questions require the demand requirement and standing analysis.
• Veil piercing and partner liability are frequently tested alongside formation defects.

• Study agency first; it is the foundation for partnership and corporate authority questions.
• Keep one page comparing liability and management default rules across entity types.
• Practise full essays rather than multiple-choice questions, since this subject is essay-tested.

163 pages across 19 chapters, organised in the order the law applies:

• Agency formation, authority, and liability
• General partnerships, LPs, and LLPs
• LLC formation, management, and veil piercing
• Corporate formation and promoter liability
• Corporate finance and shareholder voting
• Business judgment rule and duty of loyalty
• Derivative vs. direct suits and demand rules
• Mergers, appraisal rights, Rule 10b-5, and § 16(b)

• Civil Procedure
• Constitutional Law
• Contracts and Sales (UCC Article 2)
• Criminal Law and Procedure
• Evidence
• Real Property
• Torts
• Multistate Performance Test (MPT)
• Professional Responsibility (MPRE)