If two parties are not partners, they must be careful not to give the impression they are.
An ostensible partnership (or quasi-partnership) exists where there is no real partnership, but the parties act or do business in such a manner that the public, having no knowledge of the parties' private relations, reasonably would assume that a partnership exists.
Ostensible partnerships are considered fraudulent and deceitful, and any licensees who operate as ostensible partners are subject to discipline.
Ostensible partners also may be liable for each other's debts and torts. Brokers sometimes share office space but conduct their businesses separately. If such is the case, they cannot operate under the same name or use their joint names or the same trade name.
Brokers should indicate their true statuses by using separate telephone listings, letterheads, advertisements, and office signs. Advertisements reflecting that a properly registered broker is a franchisee do not fall under the definition of ostensible partnership.
Real estate licencees who operate as ostensible partners may be subject to license suspension.
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