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?

Sample Solution