Instructions: Brown And Jim Green Have Been Discussing GOI ✓ Solved

Instructionsted Brown And Jim Green Have Been Discussing Going

Ted Brown and Jim Green have been discussing going into business together for several months, and they are anxious to start that business before the end of this month. However, both Ted Brown and Jim Green each have to be out of town for several weeks on other business, so Ted Brown has told his son, Theodore, who is 16, about the discussions with Jim Green and has appointed Theodore to complete negotiation of the final details of the business. Jim Green has told his son James, who is 18 years old, about the discussions with Ted Brown and appointed James to complete the negotiations.

The business that Ted Brown and Jim Green want to create will develop an app for cell phones that will identify family-oriented attractions along major highways so families can download the app to help in planning family vacations. The development of the app will take 4 months, and then it will take approximately another 4 months to fully deploy the app. As the app becomes popular, the business will solicit family-oriented businesses to advertise on the app. Ted Brown and Jim Green have very little capital to use in the development and deployment of the app and will probably need to raise the capital necessary to develop and deploy a quality app.

In your case study, address the questions below. Can Theodore Brown and James Green legally create the business that Ted Brown and Jim Green have been discussing? Why, or why not? If Theodore and James do create the business, what duties do they each owe their father? Describe what those duties mean in this case. What factors do Ted Brown and Jim Green (or their sons on their behalf) need to consider in selecting a form for this business? What form of business will provide the most advantage for their venture? What are the disadvantages of the form of business that they selected?

Your case study should be at least four pages in length and include at least two outside sources, one of which must come from the CSU Online Library. Be sure to use APA formatting for all citations and references. Please note that no abstract is needed.

Paper For Above Instructions

The creation of a business, especially one that is envisioned by Ted Brown and Jim Green, involves a labyrinth of legal and ethical considerations. The first critical question is whether Theodore Brown and James Green can legally establish the business that their fathers have discussed. The answer largely depends on the legal capacities of Theodore and James, considering their ages. Theodore is 16, and James is 18. Under most jurisdictions in the United States, individuals under the age of 18 are considered minors and generally lack the legal capacity to enter into binding contracts (Levin & Sullivan, 2020). Therefore, while James could legally participate in the negotiations and the formation of the business due to his age, Theodore’s ability to do so is significantly limited. This difference could result in complications during the negotiation phase, where Theodore may not be able to enforce any agreements made or incur any obligations on behalf of the business.

In the scenario where Theodore and James go ahead with the creation of the business, understanding the duties they owe their fathers becomes paramount. This concept is rooted in the principles of fiduciary duty, where one party owes obligation and loyalty to another party (H 2019). For Theodore, although he is a minor and appointed as a negotiator, he still bears a sense of duty towards his father's interests. He must act in good faith, promoting the business's interests while disclosing any pertinent information to Ted Brown regarding financial agreements or contracts. Similarly, James, being older and legally able to act on behalf of the business, also has fiduciary duties, which include a duty of care and a duty of loyalty. This implies that while he manages business dealings, he must prioritize the company's well-being and transparency between parties.

When selecting a form for their business, Ted Brown and Jim Green, as well as their sons acting on their behalf, must consider multiple factors. The chosen business structure could significantly influence tax responsibilities, liability, and operational complexities (Burnett, 2022). Given that both Ted and Jim have limited capital, it might be prudent for them to consider a Limited Liability Company (LLC) or a partnership. An LLC would provide them with limited liability protection where personal assets are shielded from business debts. However, setting up an LLC may come with higher fees and regulatory requirements compared to a partnership.

A partnership, particularly a general partnership, may seem more favorable due to the simplicity in formation and fewer compliance burdens. In this structure, both Ted and Jim would have considerable control over business decisions, and profits and losses would pass through directly to their individual tax returns, avoiding double taxation (Jones, 2021). However, the downside is that each partner would share full personal liability for any debts incurred by the partnership, leading to potential financial risks.

Given the nature of the proposed business aimed at creating a family-oriented app, the flexibility of an LLC structure may cater well to their needs while minimizing personal risk. Moreover, this adaptability can assist them in attracting investors looking for a business model with lower risk exposure. On the contrary, the partnership might leave them vulnerable if the business does not succeed, as both Ted and Jim could face financial repercussions personally.

Overall, the future of the app development not only hinges on the form the business takes but also on the fiduciary duties accepted by Theodore and James, as well as the level of legal authority they have as representatives of their fathers. Ted and Jim must closely evaluate the implications of the legal capacity of their sons, ensuring they are compliant with laws while aligning with their business goals.

References

  • Burnett, S. (2022). Choosing the Right Business Structure. Entrepreneur. Retrieved from https://www.entrepreneur.com/article/283001
  • H, A. (2019). Current developments in partners and partnerships. Tax Adviser, 50(2), 1–18.
  • Jones, R. (2021). Understanding Partnerships. Business Law Review, 45(3), 25-33.
  • Levin, M., & Sullivan, A. (2020). Business Law: Text and Cases. Cengage Learning.
  • Smith, J. (2023). Legal Obligations of Minors in Business Ventures. Law Journal, 34(1), 10-12.
  • Green, T. (2023). The Importance of Business Structure. Harvard Business Review. Retrieved from https://hbr.org/2023/03/the-importance-of-business-structure
  • Walker, P. (2022). Startups and their Legal Framework. Journal of Business Development, 19(4), 200-210.
  • Anderson, J. (2021). App Development and Business Organization. Tech Ventures Journal, 28(2), 45-59.
  • Thomas, K. (2019). App Monetization Strategies. Digital Marketing Insights, 16(5), 300-310.
  • Rodgers, L. (2023). Family Businesses and Succession Planning. Journal of Entrepreneurship, 12(3), 50-65.

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