Q.A firm engages M, a well-known local businessperson, to allow use of his name and reputation for the firm's credibility, though M contributes no capital and takes no part in management. M is best classified as a:
(A) Sleeping Partner
(B) Nominal Partner
(C) Partner in Profits Only
(D) Secret Partner

A partner who lends only their name/reputation, with no capital and no management role, matches the definition of a nominal partner exactly.

A Nominal Partner neither contributes capital nor takes part in management, but lends their name and reputation to the firm, and remains liable to third parties who reasonably relied on the use of that name.

Option-by-option analysis:

• (A) Incorrect — a sleeping partner does contribute capital and share profits/losses, just without taking part in management; M contributes no capital here.
• (B) Correct — M's role (name/reputation only, no capital, no management) is the textbook nominal partner. …