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Hynansky v. Vietri

Delaware Court of Chancery
2003 WL 21976031


In 1988, John Hynansky (plaintiff) and Albert Vietri (defendant) undertook a business venture together to purchase and develop a parcel of land. As part of the closing on the purchase of the property, Hynansky and Albert signed a document labeled “Partnership Agreement” which purported to establish a partnership named JHV Associates. The agreement designated the two parties as partners, stated that it was formed under the Delaware Uniform Partnership Law, and provided that separate capital accounts would be maintained for each partner. Zoning issues prevented Hynansky and Vietri from developing the property after the purchase as they hoped. In 1994, they sold the property at a substantial loss. Hynansky sued Vietri for Vietri’s unpaid initial capital contribution and for Vietri’s pro rata share of the business’s losses. Vietri argued that he did not intend to form a partnership or know that a partnership was being created. He stated he did not read the agreement and was misled by his attorney, who told him that a limited liability entity was being created. He did not believe he would become an equity participant until the parcel was successfully rezoned. He also alleged that Hynansky treated the entity’s assets as his own for tax purposes, and that Hynansky elsewhere referred to the entity as a corporation. Hynansky moved for summary judgment.

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