Byker v. Mannes
Michigan Supreme Court
641 N.W.2d 210 (2002)
David Byker (plaintiff) and Tom Mannes (defendant) agreed to undertake various business activities together. They did not enter into a formal agreement. The two jointly served as general partners or shareholders in various entities and agreed to share equally in all profits and losses. When one of their entities began to struggle, Byker and Mannes funneled cash from their other entities into it and also made personal contributions to the company. Mannes ultimately refused to contribute more money, but Byker continued without him. Eventually, all their common ventures ceased. Byker asked Mannes for equalizing payments, to equalize their losses from the enterprises. Mannes refused. Byker sued Mannes to recover the money, arguing that there was a general partnership underlying all of their business activities. Mannes contended that they had never actually intended to become partners. The trial court found in favor of Byker. The appellate court reversed, holding that subjective intent to form a partnership was required for a partnership to be implied under Michigan law. Byker appealed.
Rule of Law
Holding and Reasoning (Markman, J.)