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Simple English definitions for legal terms
jingle rule
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A quick definition of jingle rule:
Term: Jingle Rule
Definition: The jingle rule is a legal principle that determines how partnership creditors can claim assets from individual partners. Under this rule, partnership creditors have priority over all partnership assets, while separate creditors of individual partners have first priority in the individual assets of those partners. This rule has been modified under the Revised Uniform Partnership Act.
A more thorough explanation:
Definition: The jingle rule is a legal principle that determines the priority of claims made by creditors of a partnership and its individual partners. Under common law, partnership creditors have priority in all partnership assets, while separate creditors of individual partners have first priority in the individual assets of those partners.
For example, if a partnership owes money to a bank and one of the partners owes money to a supplier, the bank would have priority in the partnership's assets, while the supplier would have priority in the individual assets of the partner.
The jingle rule was later modified under the Revised Uniform Partnership Act, which provides for a more equitable distribution of assets among creditors.