Appellate Division of the Supreme Court of New York, First Department · 1997 · Corporations
245 A.D.2d 138 (1997)
Updated
CorporationsPartnershipintent to be boundobjective evidencecourse of dealingperformancesummary judgmentself-serving assertions
Facts
Plaintiffs claimed that plaintiff Irene Kantor was a partner in the defendant partnership under the subject agreement. Defendants moved for summary judgment dismissing the complaint. The record contained uncontradicted evidence of the parties' course of dealing and performance under the agreement. Plaintiffs relied on their own assertions about their subjective understanding and private intent, rather than objective evidence showing an intent to be bound by the partnership terms they asserted.
Issue
Whether summary judgment dismissing the complaint was proper where plaintiffs claimed Irene Kantor was a partner, but the uncontradicted course of dealing and performance showed no objective manifestation of intent to be bound by the asserted partnership terms.
Rule
A claim that a party was a partner under an agreement may be summarily dismissed when uncontradicted evidence of the parties' course of dealing and performance shows no objective manifestation of an intent to be bound by the asserted terms; self-serving assertions of subjective understanding or private intent are insufficient.
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One of 10 multiple-choice questions for this case. Pick an answer to see why.
In Seattle, Nora Feld sued Harbor Slate Ventures, alleging she had become a partner in a real-estate investment venture. During discovery, the undisputed record showed that for three years she was always paid a fixed monthly consulting fee, never shared losses, never signed venture documents as a partner, and was repeatedly identified in internal records as an outside adviser.
If Nora opposes summary judgment solely with an affidavit stating that she personally understood the arrangement to make her a partner, how should the court rule?
Explanation. The governing rule is that a claimed partnership may be summarily dismissed when uncontradicted evidence of the parties' course of dealing and performance shows no objective manifestation of intent to be bound by the asserted partnership terms. Nora's affidavit describes only her subjective understanding and private intent, which is insufficient to defeat summary judgment.