Binkley v. Palmer
| Decision Date | 02 November 1999 |
| Citation | 10 S.W.3d 166 |
| Parties | (Mo.App. E.D. 1999) . Kenneth D. Binkley, et al., Appellants, v. Arnold Palmer, Palmer Course Design Company, Arnold Palmer Golf Management Company, Respondents. Case Number: ED75643 Missouri Court of Appeals Eastern District Handdown Date: |
| Court | Missouri Court of Appeals |
Appeal From: Circuit Court of St. Louis County, Hon. Bernardt Drumm, Jr.
Counsel for Appellant: John F. Arnold, Carolyn Marie Kopsky, James Carter Hetlage, Kevin Lee Fritz and John L. Allen
Counsel for Respondent: Gary L. Mayes and James W. Erwin
Opinion Summary: This appeal arises out of the failure of a project to establish a resort and accompanying golf course in the Lake of the Ozarks. Investors in the project appeal summary judgment entered in favor of the Arnold Palmer entities on all claims in their petition.
AFFIRMED.
Division Two holds: (1) The Arnold Palmer entities were not partners in fact or by estoppel, and were not joint venturers, with promoters and sellers of the North Port resort project where facts demonstrate the Arnold Palmer entities merely participated in the design, management and promotion of the golf course portion of the project. (2) It was not error for the trial court to deny the investors' request to depose Arnold Palmer before considering the Arnold Palmer entities' motion for summary judgment, where the investors' affidavit in support of their motion to continue the summary judgment hearing did not specify what additional evidence supporting the existence of a factual dispute they would have presented to the court if the court had continued the hearing.
This appeal arises out of the failure of a project to establish a resort and accompanying golf course in the Lake of the Ozarks. Appellants, investors in the project, appeal summary judgment entered in favor of Respondents on all claims in their petition. We affirm.
Between 1989 and 1992, Appellants invested in North Port Golf Associates I, L.L.P. (hereinafter NPGA). NPGA is a limited partnership whose sole asset was a real estate and golf course development project located at the Lake of the Ozarks, known as "North Port at the Lake." North Port Equities, Inc., the managing general partner of NPGA, and North Port Associates, Inc., an affiliate thereof, were Missouri corporations created to develop a residential and vacation community at North Port at the Lake. Robert W. Carron, Joseph O. Medsker, Richard M. Groff and Sam M. Johnson, III were the officers and directors of North Port Equities and North Port Associates and the general partners of NPGA. H. Beck, Inc. was a broker-dealer marketing limited partnership interests in NPGA (collectively referred to as Promoters and/or Sellers of NPGA). In 1989, Robert Carron requested Respondents Arnold Palmer ("Palmer"), Palmer Course Design Company ("PCDC") and Arnold Palmer Golf Management Company ("APGMC") to design and manage two championship golf courses at North Point at the Lake.
On March 11, 1989, Respondents PCDC and APGMC entered into agreements with North Port Associates, whereby PCDC agreed to design two golf courses and assist with their construction and APGMC agreed to manage and operate the golf courses upon the completion of their construction. Both Agreements prohibited North Point Associates from using Respondents' names in any manner that implied their endorsement of or association with any other business of North Point Associates. The PCDC Agreement expressly disavowed any partnership or joint venture between North Port Associates and Respondents Palmer or PCDC.
In 1991, Arnold Palmer Enterprises and North Port Associates entered into an agreement (Palmer Agreement), whereby North Port Associates was granted use of Palmer's name and visage to promote the grand opening of the sale of real estate at North Port at the Lake. The Palmer Agreement disavowed any partnership or joint venture between Arnold Palmer Enterprises and North Port.
On several occasions prior to the sale of limited partnership interests in NPGA, counsel for Respondents, William Carpenter, corresponded with the general partners of NPGA, advising that Respondents' contracts with North Port Associates did not permit the Promoters and Sellers to solicit the interest of investors or financial institutions in any manner that suggested Respondents were involved in the marketing of NPGA or that Respondents approved of NPGA in any way. Respondents further demanded the inclusion of disclaimers in the official investment summary brochure for NPGA (Investment Summary) and the Confidential Private Placement Memorandum concerning NPGA (PPM). Both documents provided:
As described herein, golf course design and management services will be provided to the partnership by Palmer Course Design Company and Arnold Palmer Golf Management Company, respectively. Neither of these companies, nor Arnold Palmer, is affiliated with the partnership or general partners. Their identification is not, and should not be considered to be, an endorsement of the securities offered herein.
The PPM also stated that Respondents were not involved in any aspect of the project beyond the design and management of the golf course and that Respondents' participation in the golf course phase of the project should not be construed as an endorsement of the merits of the securities being offered.
Between 1989 and 1992, Appellants purchased limited partnership interests in NPGA through either the general partners of NPGA or through other Promoters and Sellers of limited partnership interests in NPGA. Certain of the Promoters and Sellers allegedly made optimistic predictions about the success of NPGA. The Palmer Respondents did not sell limited partnership interests in NPGA to any Appellant or other person or entity.
Appellants executed either a Subscription Agreement or Assignee Representation Letter, both of which represented and warranted that each Appellant had received, read and was familiar with the PPM for NPGA. Many Appellants received an Investment Summary or had access thereto prior to investing in NPGA.
PCDC completed the design of an 18-hole championship golf course at NorthPort. The golf course opened to the public in August of 1992. APGMC managed the golf course upon its opening. APGMC terminated its contract with North Port Associates as of September 30, 1992, due to North Port Associates' failure to pay. The project was not a financial success. NPGA, North Port Equities, and the individual general partners in NPGA were adjudicated bankrupt.
Appellants maintain that the trial court erred in granting Respondents' Motion for Summary Judgment because there exist genuine issues of material fact as to whether Respondents were partners or joint venturers, by estoppel or otherwise, in the sale of limited partnership interests in the investment company to Appellants. Appellants base this contention on two theories: (1) Respondents' conduct, acquiescence and omissions led Appellants to reasonably believe to their detriment that Respondents were partners or joint venturers with the investment company by their conduct in soliciting, promoting and endorsing the entire resort enterprise and creating the impression that they controlled, managed and were generally responsible for the entire development, and (2) Respondents intended to enter into a relationship, which in law constituted a partnership or joint venture with the investment company, as evidenced by Respondents' express and implied conduct, including certain written contracts. Appellants also claim that the trial court erred and abused its discretion in denying Appellants' request to depose Palmer before considering Respondents' Motion for Summary Judgment and allowing Respondents to rely on their affidavit of Palmer in support of their Motion for Summary Judgment.
Summary judgment is designed to permit the court to enter judgment, without delay, where the moving party has demonstrated, on the basis of facts as to which there is no genuine dispute, a right to judgment as a matter of law. ITT Commercial Fin. Corp. v. Mid-Am. Marine Supply Corp., 854 S.W.2d 371, 376 (Mo.banc 1993); Rule 74.04. When considering appeals from summary judgment, the appellate court will review the record in the light most favorable to the party against whom judgment was entered. Id. The criteria on appeal for testing the propriety of summary judgment are no different from those which should be employed by the trial court to determine the propriety of sustaining the motion initially. Id. As the trial court's judgment is founded on the record submitted and the law, an appellate court need not defer to the trial court's order granting summary judgment. Id. This makes appellate review essentially de novo. Id.
A partnership is an association of two or more persons to carry on as co-owners of a single business enterprise for profit. Section 358.060.1, All statutory references are to RSMo (1994) unless otherwise indicated. Hallmark v. Haenni, 947 S.W.2d 452, 455 (Mo. App. E.D. 1997). The primary criterion for determining the existence of a partnership is the intent of the parties to enter into such a relationship. Fischer v. Brancato, 937 S.W.2d 379, 382 (Mo. App. E.D. 1996). A joint venture is a kind of partnership. Terre Du Lac Ass'n, Inc. v. Terre Du Lac, Inc., 737 S.W.2d 206, 217 (Mo. App. E.D. 1987). A joint venture exists where there is (1) an express or implied agreement among members; (2) a common purpose to be carried out by the members of the group; (3) a community of pecuniary interest in the common purpose, and (4) an equal voice, giving an equal right of control in the direction of the enterprise. Inauen Packaging Equipment Corp. v. Integrated Indus. Services, Inc., 970 S.W.2d 360, 371 (Mo. App. W.D. 1998)....
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