Swann v. Mitchell

• Decision Date: 05 January 1982
• Docket Number: No. AC-2,AC-2
• Citation: 408 So.2d 681
• Parties: W. A. SWANN, Jr., as Personal Representative of the Estate of William Alfred Swann, Sr., Deceased, Appellant, v. A. O. MITCHELL, H. W. Mitchell, John O. Mitchell, Anis F. Mitchell and RonaldH. Mitchell, Sr., Appellees.
• Court: Florida District Court of Appeals

Page 681

408 So.2d 681

W. A. SWANN, Jr., as Personal Representative of the Estate of William Alfred Swann, Sr., Deceased, Appellant, v. A. O. MITCHELL, H. W. Mitchell, John O. Mitchell, Anis F. Mitchell and RonaldH. Mitchell, Sr., Appellees.

No. AC-2.

District Court of Appeal of Florida, First District.

Jan. 5, 1982.

Rehearing Denied Feb. 11, 1982.

W. A. Swann, Jr., in pro. per.

Raymon J. Hahn of Fisher, Bell, Hahn, Winn & Schuster, P. A., Pensacola, for appellees.

PER CURIAM.

Swann appeals a summary final judgment in his action for partnership accounting and other relief. He contends that the trial judge erred in determining, based upon the terms of a written partnership agreement, that his deceased father had no interest in the partnership business in excess of his share of profits already distributed to him by the partnership. We reverse.

In 1966, appellant's deceased father, William Alfred Swann, Sr., entered into a partnership agreement with the Mitchells. The agreement provided that Swann would receive a five percent profit share although he made no capital contribution. The Mitchells provided the capital in varying shares. Swann was to manage the business of the partnership, an automobile dealership. This agreement essentially continued a relationship between the parties which had been in existence for a period of twelve years. In 1967, Swann retired as business manager, and ceased all activities in the business or partnership affairs. However, he continued to receive payments representing his profit share, although paid to him in the form of salary or wages, until 1979. In that year, the partnership was dissolved by the remaining partners, and all assets were transferred to a corporation whose capital stock was issued to certain partners who continued with the business. Swann was not notified or consulted concerning the partnership dissolution and conversion of the business to the corporate form until early in 1980, at which time he received a final payment from the business. Swann came to the conclusion that the dissolution without his consent was wrongful, and that the distribution made to him failed to fully take account of all undistributed profits. He then filed suit, seeking a share of the capital surplus, the value of the goodwill, the stock of the corporate successor to the partnership, and accounting and damages for wrongful dissolution. The trial court found that Swann had received all that he was entitled to, and granted summary judgment for defendants. We find that there are unresolved issues precluding entry of a summary judgment.

The trial court based the summary judgment in part upon a finding of an intent, in the language of the partnership agreement, to treat partnership "assets" as entirely distinct from "profits," noting in his order granting motion for summary judgment:

The intent of the partnership agreement must be interpreted in the light of the language used in the drafting thereof. The intent may be deduced from the language of the (sic) January 1, 1966 from the reading of paragraphs 3 B&C, which clearly set forth the intent of the agreement: "If either of the two partners other than the major partner and W. A. Swann should die, the other partners shall ... pay to the personal representative of the decedent, the full value of his interest in the partnership assets and accumulated profits...."

Paragraph 3C sets forth the rights of W. A. Swann as follows: "Upon the death of W. A. Swann the partnership shall ... pay his personal representative the share of W. A. Swann in the undistributed profits...." (emphasis in original)

We do not find the fact that paragraph 3B refers to both "assets and accumulated profits," while 3C only mentions "undistributed profits," dispositive of the controversy between the parties. Specifically, we agree with appellant's contention that nothing in the partnership agreement indicates an intention to alter the accepted definition of "profit."

Prior to the adoption of the Uniform Partnership Act (UPA), profit was defined to include the increment in value of capital assets. In Uhrig v. Redding, 150 Fla. 480, 8 So.2d 4 (1942), our Supreme Court was faced with a partnership similar to the one here. The court held:

Appellant supplied...