Professional Service Organizations: A Reply

In applying the term association as used in section 7701 (a) (3), Mr.Thies argues that we can find guidance in a largely overlooked cranny ofthe law: the common law association. Asserting that this form oforganization was characterized by centralized management and continuityof life, but not by limited liability or transferability of interests, Mr. Thiesconcludes that the first two characteristics alone are the only proper criteriaof association status. The test, in other words, is whether the organizationunder examination resembles a classic common law association, notwhether it resembles a corporation; and this in turn means that centralizcclmanagement and continuity of life are sufficient (and, evidently, necessary)to confer association status under section 7701(a) (3). Mr. Thies then assertsthat virtually all new-style professional association and corporationstatutes satisfy these criteria