facts: apt bldg 2 partners 50-50 , no written partnership agreement one partner (#1) wants to sell or get a business line of credit, or short term loan secured to property. offers received other partner (# XXXXX) refuses to accept or counter. loan or business line available, the same (# XXXXX) partner refuses to submit his tax return to the lender , and so loan and business line at bank not approved partner (#1) having financial problems , partner (#2) is fully aware and still refuses to cooperate with partner (#1) thereby forcing partner (#1) to sell to partner (#2) at a discounter price.. Partner (#1) damaged to the tune of approx $250,000 by selling to partner (#2) at a big loss just to get some funds ALSO please note Partner #1 found and created the apt deal making partner #2 over 1 mil. and did same on another deal.. this is how partner #2 "paid back" partrner #1 by stealing the property from his distressed partner Like to file suit-- can iot be for for breach of covenant of good faith and fair dealing, and interference with prospective economic gain? I belive it was a diabolical plan on the part of partner %2 to force partner #1 into a desperate fiancial situation
Dear Customer, thank you for choosing Just Answer. My name is XXXXX XXXXX X would like to assist you today.
While I am not able to give you a specific analysis of the facts in your situation, I can identify the causes of action for you that commonly are associated with acts such as the one you describe when one partner takes advantage of another through sharp practices or dishonest dealings.
The strongest cause of action is a breach of fiduciary duty. Partners owe one another a fiduciary duty, which means a duty of good faith and fair dealing (termed as "the highest standards of good faith"). You can find more details of this definition and application here: http://business-law.lawyers.com/small-business-law/General-Partnership-and-Fiduciary-Duties.html. If the partner violates this duty of good faith and fair dealing, you can receive compensation for pecuniary loss and potentially punitive damages (if you can show fraud or other such intentional torts - most commonly fraud).
Given the facts as you have described them, it is most likely that there was a breach of fiduciary duty. In addition to this claim, there may be a claim for negligence in allowing the investment of the partnership to fail (sell for far below market rate), failure to attend to the business of the partnership (all based on "falling below the standard of care for a partner"). Although you cannot force a partner to take out a loan, if you can show that they did so immediately following the dissolution, or took other such action, you can both bolster your claim for negligence, and show the intentional conduct related to self dealing and the breach of fiduciary duty.
Here are some additional resources for you to review in this matter:
An article with information and citations regarding the duties of partners to one another (there is some information for LLCs as well, you can disregard this, but the information for partnerships is very valuable): http://www.ceb.com/reporter/freeAccess/articles/fall2003.pdf
An article that is not as direct, but also has information regarding duties between partners: http://www.markhamlawfirm.com/law-articles/california-limited-liability-company/
I hope the above is helpful, I believe that based on the facts as you have stated them you likely have a case in this matter. Given the value of the loss in this matter ($250,000.00), I would strongly recommend speaking with a local attorney to discuss the matter. You can find one through the State Bar Association Lawyer Referral Site; Martindale Hubble; or AVVO.
Thank you for using our service, please do not forget to rate my answer when you are satisfied. I am going to transfer our conversation to our "Q&A" format to ensure that you can review my response and that I can respond to any questions you may have quickly. I wish you the best of luck in this matter. Best regards, Bill
like to know if it is better to have atty write a serious threatening letter outlining my position and strengths of my case ; or just go for file the lawsuitm and a lis pendens right away
Thank you.. thats as I thought. seems like its better to just file, or they may think you are bluffing
also what is the statute of limitations? ismt that so many yrs friom the date of discovery of the issue?
how about an atty taking the case on a contingency?
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