Marshall v. Irby

• Decision Date: 16 February 1942
• Docket Number: 4-6639
• Citation: 158 S.W.2d 693,203 Ark. 795
• Parties: MARSHALL v. IRBY
• Court: Arkansas Supreme Court

158 S.W.2d 693

203 Ark. 795

MARSHALL v. IRBY

4-6639

Supreme Court of Arkansas

February 16, 1942

Appeal from Benton Chancery Court; Lee Seamster, Chancellor affirmed.

Decree affirmed.

Duty & Duty, for appellant.

Earl C. Blansett and John W. Nance, for appellee.

OPINION

SMITH J.

Dr James L. Irby was engaged in the practice of the profession of dentistry in Missouri, when he received overtures from Dr. A. W. Marshall of Rogers, Arkansas, to form a partnership for the practice of that profession in the city of Rogers. Dr. Marshall then had, and, for some years prior, had had an established practice in that city. The negotiations eventuated in the execution of a contract the controlling provisions of which are as follows:

"This agreement of partnership entered into this 15th day of September, 1939, by and between A. W. Marshall, hereinafter called 'party of the first part,' and James L. Irby, hereinafter called 'party of the second part,' witnesseth:

"That the parties hereto have agreed and by these presents do agree to enter into and become a partnership upon the following terms and conditions:

. . .

"4. The partnership shall become effective as of the date hereof, and shall continue for a period of five years thereafter under the following terms hereinafter set out, unless earlier dissolved by agreement of both parties or by operation of law.

"5. Each of the parties hereto is to furnish his own equipment, tools, instruments, etc.

"6. The interests of the respective parties in this firm are as follows: All operating cost shall be borne equally by the firm. The net profits shall be divided, sixty per cent. to party of the first part and forty per cent. to the party of the second part, this division of net profits to remain in force and effect for a period of two years from the date of said partnership. During the remaining three years of this partnership, the net profits shall be divided equally, fifty per cent. to party of the first part and fifty per cent. to party of the second part. Said division of profits shall be made monthly.

"All outstanding accounts as of the date of this agreement shall not be divided, but shall be solely the assets of the party of the first part.

. . .

"12. Should either party breach any of the agreements herein contained, or, in any manner default, the remaining party may, at his option, declare this agreement at an end and proceed to wind up the affairs of the partnership business.

"13. This agreement may be extended for a period of....years from the date of expiration hereof by indorsement hereon of such extension by both parties hereto.

"14. Upon the expiration hereof, or earlier termination by dissolution or otherwise, a true and accurate final accounting concerning the affairs of this partnership shall be made and a correct distribution of the assets shall be had within fifteen days after such termination; and all debts and obligations of the partnership shall be paid before said final distribution of assets is made.

"15. Each party hereto reserved the right to dissolve said partnership with or without cause, but said dissolution shall be made only after having given the other party notice in writing at least ninety days before the time fixed for dissolving said firm.

"16. Upon the expiration of this contract, or, in the event of an earlier dissolution of this agreement, party of the second part agrees that he will not set up an office for the practice of dentistry within the city of Rogers for a period of five years from the date of dissolution or termination of this agreement."

Upon the signing of the contract, Dr. Irby gave up the practice which he then had, and bought additional equipment, costing about $ 700, to enable him to comply with the contract.

The partnership continued for about a year, when Dr. Marshall gave ninety days' notice of its termination, at the end of which time Dr. Irby removed to another location in the city of Rogers and began to practice his profession on his individual account, whereupon Dr. Marshall sought to enjoin Dr. Irby from practicing dentistry in the city of Rogers. The relief prayed was denied, and from that decree is this appeal.

Dr Marshall assigned no cause for the dissolution, but relies upon the...