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In 20X2, Anchor, Chain, and Hook created ACH Associates, a general partnership. The partÂners orally agreed that they would work full time for the partnership and would distribute profits based on their capital contributions. Anchor conÂtributed $5,000; Chain $10,000; and Hook $15,000.
The ACH Associates oral partnership agreement was valid.
Explanation: A contract, including a partnership agreement, must be in writing under the Statute of Frauds in order to be enforceable it cannot be completed within one year. Although the partnership lasted for more than one year, it could have been terminated within one year. As a result, the oral partnership agreement was valid.
BUT I still do not understand why? I thought that it is required to have a contract for anything past 1 year. Please help! Thank you
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