Facts. Enea (P) and the Daniels' (D) partnership consisted of a sole asset in the form of a building in which offices were rented out. The Daniels (D) rented out office space to themselves at less than fair market value, So Enea (P) filed an action for breach of fiduciary duty. The Daniels (D) contend that there was no provision in the partnership agreement to rent out at fair market value, and no provision among partners to maximize rental profits. The trial court granted summary judgment to the Daniels (D) based off of a statue that asserts that partners do not breach duty if their conduct only furthers their own interest. The appellate court allowed the appeal.
Chapter 31
RNR investment limited partnership v people first community bank
RNR Investments Limited Partnership (RNR) (defendant) was created to purchase and develop a parcel of land. RNR's written partnership agreement restricted general partner Bernard Roeger's capacity to commit the partnership to expenses beyond what was approved in the budget. Specifically, Roeger was prohibited from exceeding the budget by more than ten percent for any line item, without the prior written consent of the limited partners. Roeger obtained the approval of the limited partners to seek $650,000 in financing for construction. Without consulting the limited partners, Roeger entered into a construction loan agreement and mortgage with People's First Community Bank (Bank) (plaintiff) in the amount of $990,000. Bank had no knowledge of the partnership agreement's restrictions. RNR defaulted on the loan, and Bank sued RNR in foreclosure. The trial court granted summary judgment to Bank, rejecting RNR's arguments that Bank had a duty to discover the limitations on Roeger's authority.
Conklin farm v Leibowitz
Three individuals formed a partnership called LongView to acquire Conklin Farm. The three individual's names were Paula Hertzberg, Elliot Leibowitz, and Joel Leibowitz. The day the partnership was formed they executed a promissory note in favor of Conklin for 9 million dollars. The note was signed by all three partners. On March 15, 1990 Joel Leibowitz assigned his thirty percent to his wife who had agreed to be bound by all the terms of the partnership agreement. LongView had a project for condominium that failed and defaulted on the note. In March 1991 LongView filed for bankruptcy. All three partners were discharged of any personal liability on the Conklin note. Conklin sued Doris Leibowitz saying that she was liable for 30% of the accrued interest.
Warnick v Warnick