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Drashner v. Sorenson

Supreme Court of North Dakota
63 N.W.2d 255 (1954)


C.H. Drashner (plaintiff), A.D. Sorenson (defendant), and Jacob Deis (defendant) formed a partnership to operate a real estate, loan, and insurance business. Sorenson and Deis fronted $7,500 to purchase the business from its original owner. The parties had no written partnership agreement but orally agreed that the $7,500 would be repaid to Sorenson and Deis from partnership earnings. They also agreed on percentages which each partner would receive in commissions from their respective sales. Disagreements soon arose. Drashner neglected his duties, and also requested additional cash distributions from the partnership, which Sorenson and Deis refused to grant. In order to cash out his share of the partnership, Drashner sued Sorenson and Deis, seeking an accounting and the dissolution of the partnership. At the time of filing, Sorenson and Deis had only recouped $3,000 of their $7,500 loan. The trial court granted the dissolution, but found that it was in contravention of the partnership agreement. The court further found that Drashner was entitled to a distribution based only on the value of partnership property and not including the good-will value of the business. Since the assets were valued at less than the amount still owed to Sorenson and Deis, the court held that Drashner had no interest in the business and was entitled to nothing at dissolution. Drashner appealed.

Rule of Law


Holding and Reasoning (Smith, C.J.)

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