Bowling Associates, Ltd. v. Kerrey, S-95-317

• Decision Date: 09 May 1997
• Docket Number: No. S-95-317,S-95-317
• Citation: 252 Neb. 458,562 N.W.2d 714
• Parties: BOWLING ASSOCIATES, LTD., a Nebraska limited partnership, et al., Appellants, v. J. Robert KERREY and Dean Rasmussen, Appellees.
• Court: Nebraska Supreme Court

Page 714

562 N.W.2d 714

252 Neb. 458

BOWLING ASSOCIATES, LTD., a Nebraska limited partnership, et al., Appellants, v. J. Robert KERREY and Dean Rasmussen, Appellees.

No. S-95-317.

Supreme Court of Nebraska.

May 9, 1997.

Syllabus by the Court

1. Summary Judgment: Appeal and Error. Summary judgment is proper only when the pleadings, depositions, admissions, stipulations, and affidavits in the record disclose that there is no genuine issue as to any material fact or as to the ultimate inferences that may be drawn from those facts and that the moving party is entitled to judgment as a matter of law. In reviewing a summary judgment, an appellate court views the evidence in a light most favorable to the party against whom the judgment is granted and gives such party the benefit of all reasonable inferences deducible from the evidence.

2. Limitations of Actions: Fraud. An action for fraud does not accrue until there has been a discovery of the facts constituting the fraud, or facts sufficient to put a person of ordinary intelligence and prudence on an inquiry which, if pursued, would lead to such discovery.

James A. Eske, of Barlow, Johnson, Flodman, Sutter, Guenzel & Eske, Lincoln, for appellants.

Carl J. Sjulin, of Rembolt Ludtke & Berger, Lincoln, for appellees.

WHITE, C.J., CAPORALE, WRIGHT, CONNOLLY, and GERRARD, JJ., and COADY, District Judge.

PER CURIAM.

In 1977, J. Robert Kerrey and Dean Rasmussen, appellees, planned to create a partnership which would be composed of both general and limited partners. In compliance with the partnership laws, they circulated an offering circular on May 12, 1977. The circular invited individuals to invest, as limited partners, in the general partners' effort to develop, own, and operate a bowling facility known as Sun Valley Lanes in Lincoln, Nebraska. Among the projected expenses set forth in this circular was an expense of $25,000 for a liquor license.

In July 1977, 24 limited partners and appellees, in their capacity as general partners, executed an agreement creating the partnership of Bowling Associates, Ltd. The limited partners consisted of several businesspersons and corporations who represented themselves to be sophisticated investors of substantial means with sufficient knowledge and experience in business matters. The agreement contained, in part, a provision with regard to the compensation that the general partners would be entitled to receive. More specifically, section 5.3 of the agreement provided:

Compensation. The General Partners in the aggregate will be paid a salary of $600 per month plus a management fee equal to seven percent (7%) of the Cash Flow of the Partnership as determined immediately prior to the payment of such management fee, herein referred to as the "Management Fee" to be paid to the General Partners in such proportion as they may agree or in the absence of such agreement as the Managing Partner shall determine in the reasonable exercise of his discretion. Except as may otherwise be provided in this Agreement or as may be decided by the Managing Partner in his absolute discretion, reasonably applied, no Partner shall receive any salary, fees or payments from the Partnership other than distributions of Cash Flow to which such Partner may be entitled.

On February 8, 1978, a liquor license, restricting the sale of alcoholic beverages to the lounge area of the bowling alley, was issued to appellees individually. All fees associated with the purchase of such license were paid by Bowling Associates. In October 1981, the designated licensee was changed to K-R Enterprises, a Nebraska partnership owned by appellees. As anticipated by Kerrey, an ordinance was passed in 1981 legalizing the service of alcoholic beverages in the bowlers' area. Accordingly, the liquor license which was held by K-R Enterprises was extended to include the bowling lanes as well as the lounge.

On December 2, 1982, Rasmussen informed the limited partners that Kerrey and he would like to transfer the license held by K-R Enterprises to Bowling Associates. The limited partners were informed in February 1983 that the transfer of the liquor license had been approved by the city council.

In January 1983, K-R Enterprises and Bowling Associates entered into an agreement whereby K-R Enterprises agreed to sell to Bowling Associates leasehold improvements, inventory, and equipment located at Sun Valley Lanes. K-R Enterprises was to receive $25,000 for such sale.

The annual meeting for the business year 1983 was held in March 1984. A printed balance sheet for 1983 was prepared, indicating as a new asset a deferred charge of $25,000 for a liquor license. The partnership's "Statement of Changes in Financial Position" for that same year indicated that $25,000 had been paid out for a liquor license. All limited partners were given copies of the financial statements.

In 1987, appellees transferred their general partnership interest in Bowling Associates to Kerrey Holdings. Kerrey Holdings is a Nebraska general partnership in which Kerrey and Rasmussen are the sole partners.

On November 4, 1993, Bowling Associates and 17 limited partners,...