Business Associations, Pages 163–165

Summers v. Dooley

Supreme Court of Idaho, 1971

Facts:

The parties entered a partnership to operate a trash collection business, with each doing half the labor. Plaintiff wanted to hire an employee, but defendant refused. Plaintiff hired him anyway and paid him out-of-pocket. Defendant still refused to pay for him, and plaintiff eventually sued for $6,000 of the over $11,000 he had paid the employee.

Procedural History:

Trial court did not grant plaintiff his requested reimbursement.

Issue:

Does an equal partner have the authority to be reimbursed for hiring a new employee over his partner's dissents?

Plaintiff's Argument:

Even if defendant did not consent, he received benefit from the employee and should thus be required to help pay for him by estoppel.

Rule:

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"Any difference arising as to ordinary matters connected with the partnership business may be decided by a majority of the partners . . ."

Reasoning:

If a majority is required to make a decision, then nothing can change in the case of a division. Defendant voiced his objection to the hiring, so it would be unjust to permit plaintiff to recover when he was the only one who wanted it.

Holding:

No, an equal partner requires the approval of his partner to make a decision. Affirmed.


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