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COURT OF APPEALS DECISION DATED AND RELEASED FEBRUARY 21, 1996 |
NOTICE |
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A party may file
with the Supreme Court a petition to review an adverse decision by the Court
of Appeals. See § 808.10
and Rule 809.62, Stats. |
This opinion is
subject to further editing. If
published, the official version will appear in the bound volume of the
Official Reports. |
No.
94-3289
STATE OF WISCONSIN IN
COURT OF APPEALS
DISTRICT II
DANIEL WILLIAMS,
ED JOSEPH and ALAN
J. ROGERS, a Wisconsin
partnership, a/k/a BLOCK 14,
a general partnership, a/k/a
WILLIAMS, JOSEPH AND ROGERS,
a/k/a BLOCK 14 (a partnership),
by DANIEL WILLIAMS, MURIEL WILLIAMS
and BERNICE JOSEPH,
Plaintiffs‑Respondents,
v.
ALAN ROGERS,
Defendant‑Respondent,
DAVID L. KACHEL,
Defendant,
DLK ENTERPRISES, INC.,
Defendant-Counter
Claimant- Third Party Plaintiff-Appellant,
v.
DANIEL WILLIAMS,
MURIEL
WILLIAMS and BERNICE
JOSEPH,
Third
Party Defendants-Respondents,
CZARNECKI FOODS, INC.,
FIRST CITIZENS STATE
BANK OF WHITEWATER and
CITY OF WHITEWATER
COMMUNITY
DEVELOPMENT AUTHORITY,
Third
Party Defendants.
APPEAL
from a judgment of the circuit court for Walworth County: ROBERT J. KENNEDY,
Judge. Affirmed.
Before
Anderson, P.J., Brown and Snyder, JJ.
ANDERSON,
P.J. DLK Enterprises, Inc. (DLK) appeals from that
part of a final judgment touching upon an earlier grant of a partial summary
judgment against it. It also appeals
the results of a bench trial contained within the action. In particular, DLK argues that the trial
court erred regarding whether DLK's opponents in this action intended to form a
partnership, and even if there was a partnership, whether the real estate that
DLK coveted was partnership property, whether one of the principals in the
partnership had the power to convey his interests to DLK, whether DLK was
nonetheless a bona fide purchaser and whether the death of another of the
principals to the partnership terminated the partnership. We decide against DLK on all the issues and
affirm.
Daniel
Williams, Ed. Joseph and Alan Rogers began doing business together, for the
purposes of this action, in 1963 when they acquired interest in property in
Marinette county. The individuals
formed a corporation known as Wilderness Lodge, Inc. in 1964 and assigned their
interest in the Marinette property to Wilderness Lodge. The corporation was later sold. Subsequently, the association bought parcels
of land in the city of Whitewater upon which it erected a shopping center.
Daniel
Williams, Muriel Williams and Bernice (Bea) Joseph filed a complaint[1]
alleging that the partnership of Williams, Joseph and Rogers (WJR) was formed
in 1965 in order to purchase five adjoining parcels of real estate (Block 14)
with buildings on them for the purpose of using the space to erect a shopping
center and parking lot. The complaint
alleged that Rogers, who did the legal work for the partnership, unlawfully
executed a sale of partnership property to DLK in 1990.
The
partnership also alleged that there was a buy-sell agreement which prevented
any of the partners from selling their interest in the partnership to any third
party unless the same was offered for sale to the partners. In Rogers' answer to the complaint, however,
he denied that a partnership was formed in 1965 known as Williams, Joseph and
Rogers and admitted that a joint venture was created for the purpose of
purchasing the parcels of property in order to form a shopping center. No written partnership agreement or the
buy-sell portion of the agreement could be found.
In its
amended answers, affirmative defenses and counterclaim, DLK alleged that it was
the owner of an undivided one-third interest in Lots 11, 12 and 13 in Block
14. DLK demanded that its interest in
the subject real estate be established against the adverse claims of the
plaintiffs/counterclaim defendants. DLK
requested, among other things, a judgment for the partition of the premises
according to the respective rights and interests of the parties. DLK further alleged in its third-party
complaint that “D. Williams and Joseph are tenants in common of the subject
real estate with DLK.” WJR, however,
denied in its answer that DLK was a tenant in common with any of them and
denied that DLK was a partner in the partnership or was a partner with respect
to the subject real estate.
Both
parties filed summary judgment motions.
The court granted summary judgment on several issues, including its
determination that a partnership did exist which was the owner of Block
14. The court also granted WJR's motion
that Rogers could not assign any specific property owned by the WJR partnership
and that DLK could not claim that it was a bona fide purchaser of the real
estate. The court denied DLK's summary
judgment motions.[2] The court concluded that there were issues
of fact that it could not resolve by summary judgment: “I do not grant plaintiffs' summary judgment
¼ on the question of
whether or not Rogers could assign his one-third interest in the
partnership.” A bench trial was held
where the court heard testimony as to whether there was a buy-sell agreement
between the parties. The court
subsequently decided that there was a buy-sell agreement with a right of first
refusal.
In finding
for the plaintiffs, the trial court related the evidence it relied on: Muriel Williams, Daniel Williams, Bea Joseph
and Paul Joseph stated that they saw the document. Three of them said that they signed it. Regarding Rogers, the court stated:
I also felt that in reference to his problems with
partnership and joint ventures that I did not find him very credible. I find it hard to believe that he would have
constantly referred to partnership in documents, never referred— as far as I
could see—to the term “joint venture” where any other witness testified he used
it until such time as it came to his contacts with Mr. Kachel. I think that he knew well that it was a
partnership in this case; and because I think that, it buttresses my belief
that he is not telling the truth and is not a very credible person at this
time.
The court concluded that Rogers had to give the other
partners the right of first refusal—the right to match a third-party
offer. Because he did not do so, the
court stated that Rogers had no right under the contract partnership agreement
to transfer his one-third interest or to assign his one-third interest in the
partnership. Because he had no such
right, that transfer was void. DLK
appeals both the summary judgment and the judgment rendered after the bench
trial.
DLK argues
that “[t]here was clearly a genuine issue as to a material fact with regard to
the issue of whether or not a partnership existed.” In reviewing summary judgment determinations, we apply the same
standards as the trial court. Posyniak
v. School Sisters of St. Francis, 180 Wis.2d 619, 627, 511 N.W.2d 300,
304 (Ct. App. 1993). A summary judgment
motion shall be granted “if the pleadings, depositions, answers to
interrogatories, and admissions on file, together with the affidavits, if any,
show that there is no genuine issue as to any material fact and that the moving
party is entitled to a judgment as a matter of law.” Section 802.08(2), Stats. The party moving for summary judgment is
required to demonstrate that a trial is not necessary and establish a record
sufficient to demonstrate to the satisfaction of the court that there is no
triable issue of material fact on any issue presented. Heck & Paetow Claim Serv., Inc. v.
Heck, 93 Wis.2d 349, 356, 286 N.W.2d 831, 834 (1980).
Existence of a Partnership
We must decide whether there is a genuine
issue as to any material fact that a partnership was formed. In order for a partnership to exist, four
elements must be proven:
(1) The parties
intended to form a bona fide partnership and accept the accompanying legal
requirements and duties,
(2) The parties
have a community of interest in the capital employed,
(3) The parties have an equal voice in the partnership's
management, and
(4) The parties
share and distribute profits and losses.
Tralmer Sales & Serv., Inc. v. Erickson, 186 Wis.2d 549, 563, 521 N.W.2d 182, 187 (Ct. App.
1994). “A partnership agreement, whether
expressed or implied, may be in writing or proven by circumstantial evidence
demonstrating that the conduct of the parties was of such a nature as to
clearly express the mutual intent of the parties to enter into a contractual
relationship.” Heck & Paetow
Claim Serv., 93 Wis.2d at 359, 286 N.W.2d at 836. Whether a partnership exists requires the
application of facts to a legal standard.
This is a question of law that we review de novo. See Kimberly-Clark Corp. v. LIRC,
138 Wis.2d 58, 66, 405 N.W.2d 684, 688 (Ct. App. 1987). The burden of proof of establishing a
partnership relationship is on the party claiming that such a valid
relationship exists. See First
Nat'l Bank v. Schaefer, 91 Wis.2d 360, 373-74, 283 N.W.2d 410, 417-18
(Ct. App. 1979).
Initially,
we look to the evidence of whether the parties intended to form a bona fide
partnership and accept the legal requirements and duties necessary to such a
relationship. WJR asserts that Daniel
and Muriel Williams and Bea Joseph testified that they signed a partnership
agreement.[3] In the A & P lease, the association
between the plaintiffs is characterized as a partnership. WJR also asserts that:
Countless other legal documents and papers identify the
group as a partnership at its inception.
From ¼ 1969 through 1990, the partnership had a separate
taxpayer I.D. number and filed partnership tax returns. ¼ All are
accompanied by a Schedule K and K-1, also identified as part of Federal Form
1065. The schedules show form K-1
income/loss to each partner which passed through their individual tax
returns.
We agree with WJR that this information is probative of
the parties' intent to form a partnership.
“Tax returns which show the person or entity as receiving profits from
the business are prima facie evidence that a partnership exists. Once a prima facie case is made that a
partnership existed, the burden then shifts to the other party to show that no
partnership existed.” Id.
at 373, 283 N.W.2d at 417 (citations omitted).
DLK
disagrees that there was intent to form a partnership, stating that Block 14
was deeded to Rogers, Williams and Joseph as tenants in common or with no
designation at all as to the form of the ownership. It argues that this case involved a single transaction—the
purchase of Block 14 to build a shopping center and further the interest of the
joint venture. “A joint venture exists
when two or more parties agree to contribute money or services in any
proportion towards a common objective, exercise joint ownership and control and
share profits but not necessarily losses.”
Bulgrin v. Madison Gas & Elec. Co., 125 Wis.2d 405,
412, 373 N.W.2d 47, 51-52 (Ct. App. 1985).
DLK argues that “[a]ny preparation of income tax returns in a joint
venture, other than between spouses, may require the preparation of a
partnership income tax return.”[4]
After
reviewing the parties' briefs and the evidence presented at summary judgment,
we conclude that there is no genuine issue as to any material fact that a
partnership existed. DLK fails to
present affirmative proof that there was no intent to form a partnership. The fact that Block 14 was deeded to Rogers,
Williams and Joseph as tenants in common is a neutral designation and does
nothing to further the argument that a partnership did not exist.[5] Additionally, the assertion that this
association was a joint venture is unpersuasive considering that multiple
parcels of land were bought with different loans, which were later developed
into a shopping center with numerous leases.
This is more than a single transaction.
Furthermore,
DLK's assertion that different types of entities can use Federal Form 1065 for
annual reporting purposes does not provide evidence that the association was
something other than a partnership.
Mere allegations cannot be used to defeat a summary judgment motion. See § 802.08(3), Stats.
There
is little dispute as to the other elements necessary to prove the existence of
a partnership. There is evidence which
showed a community of interest in the capital employed. We agree with WJR that all three of the
partners signed business notes or mortgages “making them jointly and severally
liable for the whole amount to any creditor.”
Additionally,
the parties had an equal voice in the partnership's management. Numerous lease agreements were signed by all
three individuals. There is evidence
that Rogers collected rent on property owned by the partnership. All three individuals signed business
notes. Rogers also signed continuing
guaranties with the First Citizens State Bank in 1988 and 1989.
Lastly,
WJR asserts that the partners' sharing and distribution of profits and losses
was indisputable. It points to the
partnership tax returns with Schedules K and Forms K-1. It contends that each partner received
one-third of the income or loss which was then passed on to their personal tax
returns. We agree and conclude that no
material issue of fact exists as to this claim and that WJR is entitled to
judgment as a matter of law.
Partnership Property
We further
conclude that summary judgment was appropriately granted on the issue of
whether Block 14 was partnership property.
The Uniform Partnership Act, § 178.05, Stats.,
provides in part:
(1) All property originally brought into the
partnership stock or subsequently acquired, by purchase or otherwise, on
account of the partnership is partnership property.
(2) Unless the contrary intention appears,
property acquired with partnership funds is partnership property.
In the present case, the partnership acquired the
parcels of real estate constituting Block 14 through various loans in the
mid-sixties. The partnership also
borrowed the money in 1968 and built a shopping center. Additionally, numerous partnership income
tax returns show that the partnership was claiming the depreciation on the
building. The tax returns also show
that the partnership paid the taxes and insurance on the property. “Once the existence of a partnership is
established, there is a statutory presumption that property purchased with
partnership funds belongs to the partnership unless a ‘contrary intent’ is
shown.” Schaefer v. Schaefer,
72 Wis.2d 600, 605, 241 N.W.2d 607, 609 (1976) (quoting § 178.05(2)). DLK has failed to show a contrary intent.
Conveyance of Specific Partnership Property
WJR
states: “The property in this case was
specific partnership property. As such,
it could only be assigned by all of the partners.” We agree. Under the
Uniform Partnership Act, a partner cannot sell his or her interest in specific
partnership property. Section 178.21(2)
and (3)(b), Stats.,
provides:
(2) A partner is coowner with the other partners
of specific partnership property holding as a tenant in partnership.
(3) The incidents of this tenancy are such that:
....
(b) A partner's right in specific partnership
property is not assignable except in connection with the assignment of the
rights of all the partners in the same property.
We conclude that the trial court's grant of summary
judgment that Rogers could not assign any specific property owned by the WJR
partnership was appropriate.
Buy-Sell Agreement
The trial
court made a factual determination that there was a buy-sell agreement and
that:
Rogers had to turn to the other partners and give them
the right of first refusal, the right to match the offer. He did not do so. Because he did not do so, Mr. Rogers had no right under the
contract partnership agreement to transfer his one-third interest or to assign
his one-third interest in the partnership.
Because he had no such right, that transfer was void.
We will not set aside the trial court's findings of fact
unless they are clearly erroneous, and due regard shall be given to the
opportunity of the trial court to judge the credibility of the witnesses. Section 805.17, Stats.
We
conclude that the trial court's decision that there was a buy-sell agreement
which prohibited Rogers from conveying his interest without giving his partners
the right of first refusal is not clearly erroneous. The trial court weighed the credibility of the witnesses at trial
and found several of them to be very convincing:
The next thing that favors the plaintiffs' case is the
[sheer] credibility of Muriel Williams and David Williams and Bea Joseph. I'm not so much including Paul Joseph in
that, although there are elements of credibility for him too. But I did find all three of those people
very credible and believable people, and that's one of the things a judge does;
and I just found nothing in their testimony like I found in Mr. Rogers'
testimony that lead me to doubt in any way their honesty and integrity.
Daniel
Williams testified in detail at the trial as to the reason for wanting, and the
existence of, a partnership agreement:
Q And what
protections did you agree to?
A One is that
we'd have the ability to—to—we had to prove any new partner that wanted to come
in.
Q Prove or
approve? I didn't hear.
A Approve. In other words, an unwanted partner couldn't
buy in. And—
Q What was the
process—okay, go ahead, continue.
A If a partner
came to us, one of the partners said, “I have a—my son that wants to buy my share,” we'd say, “How much does your son want to pay for your
share?”
And if he said
a given amount that was a good buy, we said, “We'll buy your son's share.” That's in the buy and sell agreement.
Daniel Williams also
testified as follows:
[W]e had, I think they call it the—I know they call it
the right of first refusal. If a
partner was offered some money for his share, we had the right to buy it at
that amount, and the partner would be gone; or we would have the right to
refuse it. In that case, if we refused
it and we approved the partner, we ended up with a new partner.
Muriel Williams
testified:
A That we would
have a right to buy out if someone brought in a proposal. If someone wanted to get out and brought in
a proposed partner, that we would have the right to accept or refuse it.
That we would
have to—have the right to buy it from him if we felt that it was a satisfactory
price. That we would also have the right to say no, to
get rid of that person and make the partners stay with us.
....
Q Do you recall
seeing a written document?
A Yes.
Bea Joseph testified:
Q What did they
say would happen in that event if one of [them] wanted to sell his interest,
for example?
A Well, the
other people, the other parties should have the right to buy them out before
they brought in somebody new.
....
Q ¼ But
did there come a time when you signed a partnership agreement?
A That I signed
it, yes.
....
Q Now, you had
understood from earlier conversations that you heard between the husbands,
including Mr. Rogers, what the terms of this document were supposed to be; is
that correct?
A Yes.
Q Okay. And was it your understanding at the time
you signed it that there would be a provision in it such as you had heard them discuss about buying each
other out if they wanted to sell?
A That's right.
Q Okay, and when
you signed it, was it your understanding that such a provision was in that
document?
A Yes.
This evidence supports the trial court's conclusion that
a buy-sell agreement existed which prevented Rogers from selling his interest
to DLK.
Bona Fide Purchaser
DLK
asserts that it is a bona fide purchaser of the one-third interest in the real
estate and is therefore entitled to a judgment of declaration of interest in
the real estate and a judgment of partition.
DLK cites Kordecki v. Rizzo, 106 Wis.2d 713, 719-20, 317
N.W.2d 479, 483 (1982), for the proposition that a bona fide purchaser is one
who is without notice of a prior interest.
In the present case, however, there is overwhelming evidence that DLK
was aware that a partnership existed. A
title commitment from the Chicago Title Insurance Company, listing DLK as the
proposed insured, mentions Rogers, Joseph, Williams and their wives as a
partnership.
Additionally, Rogers
executed a bill of sale from himself to DLK which states:
Any and all right, title and interest Seller may have in
a “partnership” known as “Williams, Joseph and Rogers, a Partnership.” Seller does not warrant or represent that
this is a partnership. Seller owns an
undivided one-third interest in a shipping center at West Center Street,
Whitewater, Wisconsin. Seller holds
title to an undivided one-third interest in said real estate with other
parties.
In the event that the interest of the Seller is deemed
to be a partnership interest, Seller hereby conveys any and all right, title
and interest he may have in said partnership to the Buyer. In conjunction with the execution of this
Bill of Sale, Seller has also executed and delivered to Buyer a certain quit
claim deed conveying any and all right, title and interest Seller may have in
the real estate. Upon execution of
these documents, Seller shall have no interest in either the real estate or the
partnership. All right, title and
interest of the Seller is hereby conveyed to the Buyer.
We conclude that there is no genuine issue as to any
material fact that DLK had notice, whether actual or constructive, that a
partnership was involved with the property in question and that WJR is entitled
to judgment as a matter of law.[6]
Termination of Partnership
DLK argues that the
trial court committed error in determining that a partnership existed and that
the death of Ed Joseph did not terminate the activities of the
partnership. We agree with WJR that “Ed
Joseph's death did not affect partnership status when the remaining partner
continued the partnership as reconstituted.”
The death of a partner causes dissolution of the partnership. Section 178.26(4), Stats. Section
178.25, Stats., provides:
(1) The dissolution of a partnership is the
change in the relation of the partners caused by any partner ceasing to be
associated in the carrying on as distinguished from the winding up of the
business.
(2) On dissolution the partnership is not
terminated, but continues until the winding up of partnership affairs is
completed.
According to First Nat'l Bank, 91 Wis.2d
at 378, 283 N.W.2d at 419, the legal representatives of the deceased partner
have the power to consent to the continuation of the business. Specific consent is not required. “Acquiescence by the legal representatives
in the continuation of the business is sufficient for consent ¼.” Id.
We
agree with WJR that while the partnership had been dissolved when Rogers
executed the bill of sale to DLK in October 1989, “the business of the
partnership had continued as contemplated by the statutes, and there had been
no winding up or termination of that business.” We conclude that under the Uniform Partnership Act and the
circumstances of this case, there is no genuine issue as to any material fact
that Ed Joseph's death did not terminate the partnership and that WJR is
entitled to judgment as a matter of law.
Alleged Prejudice
Lastly,
we reject DLK's claim that “the trial court displayed a prejudicial
pre-judgment of the credibility of Alan Rogers by attempting to have an alcohol
breathalyzer test performed of him prior to the completion of his
testimony.” DLK has not fully developed
its argument as to how the trial court's request, which it later reconsidered,
was prejudicial and cites no case law for its assertions. We therefore do not consider it. Issues not fully developed will not be
considered on appeal. Vesely v.
Security First Nat'l Bank Trust Dep't, 128 Wis.2d 246, 255 n.5, 381
N.W.2d 593, 598 (Ct. App. 1985).[7]
By
the Court.—Judgment affirmed.
Not recommended for
publication in the official reports.
No. 94-3289
SNYDER,
J. (dissenting). Because ch. 178, Stats., Wisconsin's Uniform Partnership
Act (UPA), clearly applies and controls the conveyance/assignment of Alan
Rogers' partnership interests to DLK[8]
in the absence of a producible written partnership agreement containing a
buy-sell provision or an acquiescence to such an agreement by the partners, I
respectfully dissent. Simply put, an
alleged, but unproduced, contested parole evidence partnership buy-sell
agreement cannot usurp the provisions
of the UPA where the UPA provides a statutory remedy.
I
concur that WJR is a partnership. It is
undisputed that no written partnership agreement or written buy-sell provision
was ever produced as evidence. The two
surviving original partners disagree as to the existence of any such
documents. Rogers says “no”; Williams
says “yes.” The partners, therefore, do
not acquiesce in the existence or the terms of the documents. Under the circumstances, I conclude that the
UPA prohibits an evidentiary reconstruction of disputed partnership documents
to the exclusion of the UPA and for the benefit of one partner against another
partner and a third party. My
underlying concerns are four-fold.
First,
as a Wisconsin partnership, WJR is subject to the provisions of the UPA in
resolving partnership disputes and issues unless a clear partnership intent is
expressed otherwise that would not violate the UPA. That is fundamental partnership law. The UPA is intended to protect more than partners; it is
“intended ... to both protect partners from one another and ... [is] also
intended to protect persons who deal with partnerships.” Wyss v. Albee, 193 Wis.2d 101,
114, 532 N.W.2d 444, 448 (1995).
Because the trial court fashioned a remedy outside of the UPA, contrary
to the intent and purpose of the UPA, the Wyss intentions were
mooted. The UPA is to be construed
liberally to meet the legislative intentions.
See § 178.02(1), Stats.
Second,
faced with WJR's contention that a written, but not producible, partnership
buy-sell agreement existed, the trial court wrongly applied the rules of
contract law, parol evidence and witness credibility in an evidentiary trial to
resolve the partnership interest assignment issue. However, the issue was resolvable under UPA provisions. “In any case not provided for in this
chapter the rules of law and equity ... shall govern.” Section 178.02(6), Stats. (emphasis added).
Chapter 178, Stats.,
provided a statutory resolve of the WJR/Rogers/DLK issue.
Third,
the following UPA provisions apply directly to the assignment of Rogers'
partnership interest to DLK:
The
property rights of a partner are that partner's rights in specific partnership
property, that partner's interest in the partnership, and his or her
right to participate in the management.
Section 178.21(1), Stats.
(emphasis added).
A partner's
interest in the partnership is the partner's share of the profits and
surplus, and the same is personal property.
Section 178.22, Stats.
(emphasis added).
A
conveyance by a partner of the partner's interest in the partnership ...
merely entitles the assignee to receive ... the profits to which the assigning
partner would otherwise be entitled.
Section 178.23(1), Stats.
(emphasis added).
In case
of a dissolution of the partnership, the assignee is entitled to receive the
assignor's interest and may require an account from the date only of the last account agreed to by all
the partners.
Section 178.23(2) (emphasis added).
The
UPA clearly provides that Rogers can assign/convey his partnership interests
and that DLK has rights as the assignee of Rogers' profits and, because the
partnership was in dissolution, of Rogers' “interests.” Ignoring the UPA provisions by indulging an
outside remedy to the partnership dispute undermines the intent and purpose of
the UPA and renders meaningless the Wyss message.
Finally,
Schaefer v. Schaefer, 72 Wis.2d 600, 241 N.W.2d 607 (1976), is
cited as the only authority for the trial court's proposition that “if there
was an oral contract in this particular case, and if its terms are clear
enough, [the trial court] can enforce [the oral contract] even though ... it
was not in writing.”[9] If that is valid partnership law, the
Wisconsin UPA has been effectively gutted.
Schaefer provides a narrow exception to the statute of frauds
where a partnership created to deal in real estate lacks a written partnership
agreement but “where all parties have performed the contract, indicating their
acquiescence in its terms.” Id.
at 606-07, 241 N.W.2d at 610. Schaefer
does not provide judicial authority to substitute an equivocal legal procedure
for the certain application of the UPA.
The terms and conditions of a buy-sell agreement were wrongly imposed
upon Rogers and DLK where no written document was produced and no partner
acquiescence can be established.
Under
the UPA provisions, Rogers had the ability to assign/convey his partnership
interests to DLK, and DLK acquired rights as a UPA assignee for value. Rogers and DLK were wrongly denied UPA
protections. I would reverse the
enforcement of the alleged buy-sell provision and remand with directions to
apply the UPA as intended by the legislature.
[1] The plaintiffs
filed the complaint as “Daniel Williams, Ed Joseph, Alan J. Rogers, a Wisconsin
Partnership ¼, a/k/a Block 14, a General Partnership, a/k/a Williams,
Joseph and Rogers, a/k/a Block 14 (a Partnership) by Daniel Williams, Muriel
Williams and Bernice Joseph.” We will
refer to the plaintiffs in the appeal as “WJR.”
[2] The court denied
DLK's motion for summary judgment that the death of Ed Joseph terminated the
partnership. The court stated:
I'm asked to grant summary judgment to the effect that if a partnership
existed, that the death of Edward Joseph terminated that partnership. I deny summary judgment on that. Dissolution is not termination. ¼ Termination does not
occur until a point in time where all the partnership's affairs are cleared
up. ¼ That's directly
contrary to both the statute and the case law to the position argued by DLK in
that case, and obviously I must deny summary judgment.
[3] WJR cites to the
trial transcript for this information.
Trial testimony is irrelevant to our consideration of the motions for
summary judgment. We must address the
motions on the record that existed when they were decided by the trial court,
not on a record expanded by the testimony at trial. Universal Die & Stampings v. Justus, 174 Wis.2d
556, 558, 497 N.W.2d 797, 803 (Ct. App. 1993).
Similar information is contained in deposition testimony submitted at
the summary judgment stage. We
therefore consider this evidence as it was presented for summary judgment.
[4] DLK contends
that a partnership income tax return is merely informational and different
types of entities can use Federal Form 1065 for annual reporting purposes.
[5] Under the
Uniform Partnership Act, § 178.04(2), Stats.,
“Joint tenancy, tenancy in common, tenancy by the entireties, joint property,
common property, or part ownership does not of itself establish a partnership,
whether such coowners do or do not share any profits made by the use of the
property.”
[6] Additionally,
David Kachel, DLK's principal officer, testified in deposition as follows:
Q So anyway, it
would be a fair statement, however, that when you called Mr. Rogers, you were
aware of the fact that he had two partners in the community?
A Yes, sir.
¼.
A Well, I called him up and
asked him if he would be interested —interested in selling his share in his
partnership. And he said he might be,
and I asked him what he'd be interested to sell it for, and I can't remember
whether he told me at that time. But in
another conversation he did tell me. He
told me that he thought he would want $70,000 for his share.
[7] We do, however,
express our conclusion after reviewing the extensive record in this appeal that
the trial court examined the relevant facts, applied the proper legal standards
and reached conclusions that a reasonable judge could reach using a
demonstrated rational process. See Loy
v. Bunderson, 107 Wis.2d 400, 414-15, 320 N.W.2d 175, 184 (1982).