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LSDefine
Simple English definitions for legal terms
commenda
Read a random definition: initial public offering (IPO)
A quick definition of commenda:
Term: COMMENDA
Definition: Commenda is a type of business partnership where one person is in charge of managing all the property and assets of the business. It's like having a boss who takes care of everything related to the business, so the other partners can focus on their own tasks.
A more thorough explanation:
COMMENDA
A commenda is a type of business partnership where one person is responsible for managing all of the business property.
- A wealthy merchant invests money in a trading venture and appoints a trusted friend as the commenda to manage the business affairs.
- A commenda is formed between a landowner and a tenant farmer, where the landowner provides the land and the tenant farmer manages the crops and livestock.
These examples illustrate how a commenda works by showing how one person is given the responsibility to manage the business property while the other person provides the capital or resources. The commenda is a way to share the risks and rewards of a business venture while allowing one person to focus on managing the day-to-day operations.