Craig v. Hamilton, 47071
| Citation | 518 P.2d 539,213 Kan. 665 |
| Decision Date | 26 January 1974 |
| Docket Number | No. 47071,47071 |
| Parties | John E. CRAIG and Raymond L. Carney, d/b/a Carney & Craig Construction Co., Appellees, v. John A. HAMILTON, Appellant. |
| Court | United States State Supreme Court of Kansas |
Syllabus by the Court
1. Interpretation of a written contract is a judicial function and requires parol evidence of intent of the parties only if it is ambiguous.
2. On appeal, this court has the same opportunity to determine whether a written contract is ambiguous as does the trial court.
3. The dissolution of a partnership is the change in the relationship of the partners caused by any partner ceasing to be associated in carrying on the business of the firm.
4. Constitutional right to a jury trial guaranteed by Section 5 of the Bill of Rights of the Constitution of the State of Kansas refers to that right as it existed at common law.
5. The record is examined and it is held: The trial court did not err in finding the partnership was dissolved by mutual agreement of the parties on February
28, 1971, and in denying defendant's request for a jury trial, but did err in construing the agreement and in terminating defendant's right to profits as of date of dissolution without affording him an opportunity to present parol evidence.
Larry L. Kopke of Larry L. Kopke Law Offices, Great Bend, argued the cause, and Kenneth C. Havner, Great Bend, was with him on the brief for appellant.
Brock R. McPherson of Law Offices of Brock R. McPherson, Great Bend, argued the cause and was on the brief for appellees.
Defendant John A. Hamilton appeals from trial court's decision limiting his rights upon dissolution of a partnership to 10% of the profits rather than equal participation as one of three general partners.
John E. Craig, Raymond L. Carney, and John A. Hamilton, all of Great Bend, Kansas, entered into a general partnership agreement April 21, 1970, to operate Carney & Craig Construction Company. The partners soon disagreed over the division of profits and orally agreed to dissolve the partnership on February 24, 1971. Craig and Carney drew up a dissolution agreement declaring the partnership dissolved as of February 28, 1971, and incorporating therein their interpretation of Hamilton's rights to profits under their agreement. Hamilton disagreed with the terms and refused to sign it. Craig and Carney filed suit April 15, 1971, praying for a declaratory judgment, interpretation of the partnership agreement, determination of the rights of the parties thereunder, and dissolution of the partnership. Hamilton answered, denying he was entitled only to 10% of the profits and counter-claiming he was entitled to a full one-third share of the partnership profits upon dissolution. On May 18, 1971, plaintiffs tendered payment of defendant's capital and interest and 10% of the profits into court.
On August 25, 1971, defendant moved the court for an order dissolving the partnership, for an audit, for investment at interest of the $21,097.58 tendered by plaintiffs, and for a pretrial hearing on the issues. The court heard evidence and argument on that motion on October 1, 1971, and immediately ordered investment of the funds tendered, taking the other issues under advisement. The court adopted plaintiffs' interpretation of the partnership agreement based upon the evidence and argument on the motion, declared the partnership dissolved by mutual agreement as of February 28, 1971, and limited defendant's share of the partnership profits to 10% from April 21, 1970, to date of dissolution. Defendant filed a motion for Amendment of findings, amendment of judgment, or in the alternative, a new trial, contending the court construed the agreement and terminated his rights without allowing him an opportunity to produce evidence of intent of the parties to the agreement. This motion was denied and defendant appeals.
The basic dispute of the parties is whether, upon dissolution of the partnership, defendant Hamilton is entitled to one-third or 10% of the profits. The share of each partner in profits and losses is described in Paragraph 7 of the agreement by reference to the contribution each made to the assets at the commencement of the partnership:
Their respective contributions are described in Paragraph 4 of the partnership agreement:
Paragraph 15 sets forth the division of profits in the event one of the partners retires, dies or is otherwise incapacitated:
'(a) Any earned and unpaid salary due him;
'(b) His proportionate share of the accrued net profits;
'(c) His capital account.
'If a net loss has been accrued to the date of dissolution, his share of such loss shall be deducted.'
Defendant contends the agreement is ambiguous and raises questions of fact which can only be decided by parol evidence of the circumstances surrounding the making of the agreement and the intentions of the parties to the agreement. He asserts the court prematurely determined his right to profits, never having heard evidence on the issue of intent.
The interpretation of a written contract, free from ambiguity is a judicial function and does not require oral testimony to determine its meaning. (Morgan v. Wheeler, 150 Kan. 667, 95 P.2d 320; Maltby v. Sumner, 169 Kan. 417, 219 P.2d 395.) Defendant is entitled to present parol evidence only if the contract is in fact ambiguous. The record herein does not disclose affirmatively that the trial court ruled the contract was free from ambiguity, but its ruling denying any need for trial on the issue of intent of the parties to the agreement indicates the trial court was of the opinion the contract was unambiguous. Since the contract is in writing, this court has the same opportunity as did the trial court to determine the question of ambiguity. (Klema v. Soukup, 175 Kan. 775, 267 P.2d 501; ...
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