ETTA C. OAKLEY,
Plaintiff,
v
.
Pasquotank County
No. 02 CVS 138
CRAIG C. BARKLEY and
RIVER ENTERPRISES,
Defendants.
Trimpi & Nash, by John G. Trimpi, for plaintiff-appellant.
John W. Halstead, Jr. for defendant-appellee.
ELMORE, Judge.
Etta C. Oakley (plaintiff) appeals from two judgments and an
order denying her motion to amend the trial court's findings of
fact. Plaintiff joined with defendant Craig C. Barkley and others
to form River Enterprises (the partnership), a partnership
organized to purchase an old college campus on the Pasquotank river
and develop it into an apartment and recreation complex. Plaintiff
invested $60,000.00 in the partnership. This suit arises out of a
disagreement over how much return on her investment plaintiff is
entitled to receive under the provisions of the partnershipagreement. After a bench trial, the trial court entered a judgment
on 16 July 2003 awarding plaintiff the value of her partnership
interest, to be offset by $110,880.00, an amount undisputedly
already paid to plaintiff. The trial court also denied
plaintiff's motion to amend the findings of fact in the 16 July
2003 judgment.
Plaintiff appealed, and on 16 November 2004 this Court filed
an unpublished opinion stating that:
In the present case, plaintiff filed a
complaint seeking money damages. Although the
trial court ruled in plaintiff's favor, the
trial court has not entered a final judgment
against River Enterprises for the amount owed
to plaintiff. Without such a judgment, there
has been no final adjudication of the rights
of the parties. As such, the trial court's
order does not dispose of the cause as to all
the parties, but instead requires further
judicial action in order to settle and
determine the entire controversy. Moreover,
the trial court has not certified that there
is no just reason to delay the appeal pursuant
to Rule 54(b) of the North Carolina Rules of
Civil Procedure, and our review of the record
reveals no substantial right.
Oakley v. Barkley, 167 N.C. App. 109, 605 S.E.2d 11 (2004)
(unpublished). In response to this Court's opinion, the parties
entered into a stipulation that:
plaintiff received nothing by reason of the
evaluation of her partnership interest as
required by the Judgment dated July 11, 2003
and entered July 16, 2003. This stipulation
is entered for the purpose of establishing the
Judgment as a final judgment and to support an
amended judgment to the effect that there is
no just reason for delay.
By amended judgment entered 27 January 2005, the trial court
incorporated the stipulation of the parties into its judgment. Plaintiff now appeals from the original judgment, the judgment as
amended, and the order denying her motion to amend the findings in
the original judgment.
Plaintiff was one of many general partners who, as investors,
joined with Barkley to form the partnership. The partnership's
main asset was the river-side property, which if developed
appropriately and sold would create a profit for all partners. The
partnership agreement signed by all partners consisted of seventeen
articles directed at the ownership, control, and general
maintenance of the partnership. Article nine, entitled “Division
of Profits and Losses,” in relevant part reads:
Each partner shall be entitled to a pro rata
share of the net profits of the business and
shall be responsible for a pro rata share of
the net losses of the business pursuant to the
proportion of his or her capital contribution
in the partnership. . . . Distribution of
profits shall be made on or before the 31st day
of December each year. Provided, however, any
partner, regardless of capital contribution,
shall be entitled to repayment of the amount
invested herein together with interest at the
rate of twelve per cent (12%) per annum from
the date of the investment, six months from
the receipt of a written demand for the same,
sent by registered mail to Craig C. Barkley.
The return of said money shall terminate any
partnership interest of the demanding party,
who shall then execute a quitclaim deed to the
partnership of his or interest at the time his
money is returned. This return of capital
contribution plus twelve percent (12%), shall
be reduced by any monies previously paid by
the partnership to the withdrawing partner, or
shall serve as an offset as far as applicable
to any loss by the partnership.
Any retiring partner may claim the value of
his partnership to be in excess of twelve
percent (12%) return on his investment as
aforementioned. Upon such a request, thepartnership's share of the retiring partner
shall be evaluated by the remaining partners
and a fair market value for the retiring
partner's interest shall be paid to him or
her. This value shall be determined by
closing of the books and a rendition of the
appropriate profit and loss, trial balance,
and balance sheet statements. All disputes
arising therefrom shall be determined as
provided in the article on Arbitration
hereinafter included.
Plaintiff asserts that the trial court erred in applying the second
paragraph of article nine to her request for a return of capital
invested.
When reviewing the judgment of a trial court sitting without
a jury, the appropriate standard of review is “whether competent
evidence exists to support its findings of fact and whether the
conclusions reached were proper in light of the findings.” Lewis
v. Edwards, 159 N.C. App. 384, 388, 583 S.E.2d 387, 390 (2003)
(internal quotation omitted). “Findings of fact are conclusive if
supported by competent evidence, irrespective of evidence to the
contrary.” Oliver v. Bynum, 163 N.C. App. 166, 169, 592 S.E.2d
707, 710 (2004). “Where no exceptions are taken to findings of
fact, such findings are binding on appeal.” Creech v. Ranmar
Props., 146 N.C. App. 97, 100, 551 S.E.2d 224, 227 (2001).
However, a trial court's conclusions of law are fully reviewable.
Id.
Here, plaintiff assigns error to the fourteenth and fifteenth
findings of the trial court, essentially that under article nine
she was entitled to have her interest valued by the remainingpartners and that she was not entitled to seek additional money
from defendant Barkley individually.
14. Having made a demand for return of her
capital contribution, Plaintiff is entitled to
have her partnership interest evaluated by the
remaining partners, pursuant to the terms of
Article Nine of the partnership agreement, and
to be paid the difference between the
partnership interest value and the sum of one
hundred ten thousand eight hundred and eighty
dollars ($110,880.00), previously paid and
received.
15. That Plaintiff and Defendant, Craig C.
Barkley, were general partners in River
Enterprises but had no agreement between one
another whereby Defendant Barkley obligated
himself individually to pay compensation to
Plaintiff . . . .
Essentially, this dispute involves a matter of interpreting
the partnership agreement, a contract. Plaintiff argues that there
is no competent evidence to support a determination that she 1)
claimed the value of her interest in the partnership to be worth
more than twelve percent, or 2) requested that the partners
evaluate her interest, consistent with paragraph two of article
nine. Instead, plaintiff contends that there is competent evidence
demonstrating her demand for return of capital contribution,
consistent with paragraph one of article nine. Defendants do not
necessarily disagree with plaintiff's demand for the return of her
capital; rather, they argue that the trial court was correct in
imposing a “constructive condition” on the language in paragraph
one, essentially allowing this “option” only if it were financially
feasible. However, “[w]here the provisions of a contract are
plainly set out, the court is not free to disregard them and aparty may not contend for a different interpretation on the ground
that it does not truly express the intent of the parties.” Dixon,
Odom & Co. v. Sledge, 59 N.C. App. 280, 284, 296 S.E.2d 512, 514-15
(1982).
By the agreement's plain language, any partner could request
return of his or her capital investment plus twelve percent. There
is nothing in the agreement to suggest that this clause, albeit
perhaps not in the partnership's best interest, is ambiguous such
that other interpretation is necessary. The evidence before the
trial court was that plaintiff had requested the return of her
investment by letter sent to defendant Craig C. Barkley. This
evidence, in conjunction with the partnership agreement, warrants
a finding that plaintiff complied with the prerequisites for return
of her investment. There is no competent evidence in the record
that as a retiring partner plaintiff was asserting her interest in
the partnership was worth more than twelve percent. Accordingly,
the trial court erred in its fourteenth finding.
Related to the “option” invoked by plaintiff's request,
defendants, by cross-assignment of error, assert that the trial
court erred in finding that article nine was not modified at a
meeting of the general partners to limit the partners ability to
demand return of their capital.
11. That on December 10, 1994, the Plaintiff
at a meeting of the general partners, made a
motion which was seconded and unanimously
approved that no liquidation of capital
contribution would take place until the
transfer of the partnership real estate has
been transferred to new owners. That said
condition did not constitute a modification ofthe partnership agreement on a continuing
basis, as it was made solely for the purposes
of a pending sale at that time, which was
never completed.
This finding, however, is supported by competent evidence, even
though contrary evidence exists. The minutes of the general
partners meeting on 10 December 1994 reflect plaintiff made a
motion that no partnership liquidation occur until the completed
sale of the property to new owners. However, there is nothing
about the motion's passage that would suggest it was aimed at
amending or modifying the partnership agreement. Foremost, not all
the partners were attending and voted, none of the twenty or more
junior or limited partners were present. See N.C. Gen. Stat. § 59-
48(8) (2003) (“[N]o act in contravention of any agreement between
the partners may be done rightfully without the consent of all the
partners.”). Additionally, other testimony was that the motion was
made due to a pending sale, which eventually fell through. While
evidence exists that other general partners in plaintiff's position
operated as if that motion was binding on them, there is competent
evidence to support the trial court's finding.
Plaintiff also excepts to the trial court's fifteenth finding
that there was no personal agreement between her and defendant
Barkley that he pay her a monthly return. Yet, there is competent
evidence in the record to support that finding. Defendant Barkley
testified that he never agreed to be bound in paying plaintiff a
monthly return on her investment. He also testified that no other
partner was receiving such payments, nor were those paymentsnecessarily authorized by the partnership. Accordingly, we affirm
the trial court's finding on this point.
Notably then, the trial court erred in determining that
plaintiff was entitled to an evaluation of her interest under
paragraph two of article nine. We are cognizant of the fact that
this agreement is in many respects contrary to ordinary or default
provisions of partnership law. See, e.g., N.C. Gen. Stat. § 59-
48(4) (2003) (“A partner shall receive interest on the capital
contributed by him only from the date when repayment should be
made.”). However, absent any ambiguity, the agreement between the
parties controls; the parties' agreement is what we must enforce,
not their perhaps well-meaning but unwritten intentions. We
reverse the judgment of the trial court and remand the matter to
determine, under paragraph one of the agreement, how much plaintiff
is entitled to receive.
Reversed and remanded.
Judges HUDSON and SMITH concur.
Report per Rule 30(e).
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