No. 87-437 IN THE SUPREME COURT OF THE STATE OF MONTANA 1991

ALEX WEINGART, JR., Individually and as Personal ~epresentativefor RITA WEINGART, deceased, and NORMA J. WEINGART, Plaintiffs and Appellants,

-vs

### APR 

### 11199: C & W TAYLOR PARTNERSHIP, CHARLES R. TAYLOR, WYMAN D. TAYLOR, J. ANTHONY DEDE, M.D., ROBERT McCROSKEY, M.D. and 

# CJsm ,lf~ CLERK OFSUPREI)~;COUR7 JENNIE OSTLER, STATE OFiM~l~+,qpJ~ Defendants and Respondents.

APPEAL FROM: District Court of the Tenth Judicial District, In and for the County of Fergus, The Honorable Peter L. Rapkoch, Judge presiding.

COUNSEL OF RECORD: For Appellants: Robert L. Johnson, Attorney at Law, Lewistown, Montana For Respondents: Keith A. Maristuen; Bosch, Kuhr, Dugdale, Warner, Martin & Kaze, Havre, Montana (for Respondent McCroskey) J. Michael Young, Attorney at Law, Great Falls, Montana (for Respondents W.D. Taylor, C & W Partnership and C.R. Taylor) CarlA. Hatch,Attorney at Law,Helena,Montana (for Respondent Ostler)

Filed: Submitted on Briefs: December 13, 1990 ~ecided:April 11, 1991Justice William 

### E. Hunt, Sr., delivered the Opinion of the Court.

Alex Weingart, Jr., individually and as personal representative for Rita Weingart, deceased, and Norma J. Weingart appeal from a decision of the District Court of the Tenth Judicial District, Fergus County, Montana, granting summary judgment to respondents, J.Anthony Dede,M.D., Robert McCroskey,M.D., and JennieOstler on theground that they were not personally liable to theWeingarts on a contract for deed. We affirm. The sole issue is whether the District Court erred in granting summary judgment to respondents for breach of the contract between appellants as sellers and Charles R. Taylor and Wyman D. Taylor as buyers, to purchase appellants1ranch. Appellants argued that respondents, J. Anthony Dede, M.D., Robert McCroskey, M.D., and Jennie Ostler, were personally liable to appellants on one or more of three theories: first, a general partnership; second,a joint venture; and third, an agency. Brothers Charles W. Taylor and Wyman D. Taylor formed the C & W Taylor partnership to purchase the Weingart ranch. Respondents,J. Anthony Dede,M.D., RobertMcCroskey,M.D., and Jennie Ostler, contributed $55,000 each Iftoenable Charles R. Taylor and Wyman D. Taylor to purchase the ranch lands1'on orbefore December 18, 1981, and signed the "Agreement To Share General Partner Interest." This agreement was created in advance of formation of a limited partnership tomake thepurchase of theWeingart ranch possible. Theagreement provided that Charles Taylorand Wyman Taylor would buy the ranch "with the intent to transfer said land to a limited partnership to be known as C & W Limited partnership, whereunder they [CharlesTaylor and Wyman Taylor] would become the general partners and managing partners." The agreementnoted that the Ivlimited partnership agreementhasnot been effectuated. The limited partnership was not formed before the next installmenton the ranchbecame dueMay 20, 1982. C & W Taylor couldnot raise the additional capital tomake the payment, and the Weingarts served notice of default upon C & W Taylor on June 21, 1982. TheWeingarts closed the escrowand removed the documents from the escrow file. C & W Taylor strongly argued that it had 120 days, as provided in the contract, to cure default by making payment. When the second installmentdueunder the land salecontract was not made, Charles Taylor contacted the Weingarts and negotiated what C & W Taylorbelieved was a termination of the land sale contract on September 20, 1982. The terms of the agreement were alleged to be (1) forfeit of the $210,000 initial payment to theWeingarts;and (2)reinvestment of titleand interest in the ranch to the Weingarts by executing and delivering a quit claim deed and bill of sale and reassigning all BLM leases to the Weingarts. The Weingarts brought this action for specific performance

or damages against C & W Taylor as the buyer designated in the contract for deed, and respondents J. Anthony Dede, M.D., Robert McCroskey, M.D., and Jennie Ostler, alleged to be vicariously liable. The action was delayed by bankruptcy proceedings involving McCroskey and by resolution of another suit related to this transaction. SeeTaylorv. Weingart (1984)

### , 214Mont. 282, 693 P.2d 1231. All parties moved for summary judgment. On September 10,1987,theDistrictCourtgranted summary judgment in favor of respondents. The District Court denied partial summary judgment to the Weingarts and denied summary judgment to C & W Taylor on the ground that genuine issues of material fact existed between them. From the grant of summary judgment to respondents, the Weingarts appeal. The Weingarts maintain that the District Court erred in granting summary judgment to respondents because respondents,

as either undisclosed partners, undisclosed joint venturers,

or undisclosed principals, were personally liable on the contract of sale between the Weingarts and C & W Taylor. Respondentscontendthat as investors, ratherthanpartners, joint venturers, or principals, they were not liable on thecontract of sale. Summary judgment is proper where no genuine issue of any material fact exists and the moving party is entitled to judgment as a matter of law. Rule 56(c), M.R.Civ.P. ; First Security Bank of Bozeman v. Jones (1990), 243 Mont. 301, 303, 794 P.2d 679, 681. Since the facts are undisputed, the issues

are matters of law and summary judgment is appropriate. Partnership A partnership is defined as Itanassociation of two or more persons to carry on as co-owners a business for profit.I1 Section 35-10-201, MCA. To determine existence of a partnership four requirements must be met: (1) the parties must clearly manifest their intent to associate themselves in

a partnership relationship; (2) each party must contribute something that promotes the enterprise; (3) each party must have a right of mutual control over the subject matter of the enterprise; and (4) the parties must agree to share profits. Montana Bank of Red Lodge,N.A. v. Lightfield (1989)

### , 237Mont. 41, 45, 771 P.2d 571, 574; Bender v. Bender (1965), 144 Mont. 470, 480, 397 P.2d 957, 962. The Agreement to Share General Partner Interest states the clear intent by respondents to eventually become limited partners and nowhere shows theyhad any right ofmutual control

over the Weingart ranch, either in management of the ranch itself or in control of the ranch as an investment. Withouta showing of that control, the third requirement to establish

a partnership was not fulfilled. Therefore, respondents were not general partners of C & W Taylor and could not be liable

on the contract for deed. The District Court did not err in concluding that respondents were not general partners. JointVenturers To qualify as joint venturers four elementsmust bemet: (1)

an express or implied agreement or contract creating the joint venture; (2)a common purpose among the parties; (3) community of interest;and (4) an equal right of control of theventure. Papp v. Rocky Mountain Oil & Minerals (1989)

### , 236 Mont. 330, 342;769 P.2d 1249, 1257. Although managementmay be delegated to one joint venturer while the others retain the right of control, Murphy v. Redland (1978), 178 Mont. 296, 583 P.2d 1049, it must be an equal right of control. Here the respondents did not have an equal right of control of the venture. Therefore, the court did not err in concluding that respondents were not joint venturers with Charles and Wyman Taylor. Principal/Aqent The appellants next contend that the Agreement to Share General Partnership Interestcreated an agency relationship to allow the Taylors to acquire theWeingart ranch for themutual benefit of the five investors and that respondents were undisclosed principals.I An agent is "one who represents another, called the principal, in dealings with third persons.l1 Section 28-10- 101, MCA. 'I 'Agency is the fiduciary relation which results fromthemanifestation of consentby oneperson to another that the other shallact onhisbehalf and subjecttohis control.'I1 Kochv. YellowstoneCounty (1990),243Mont. 447, 453, 795 P.2d 454, 458 (quotingRestatement (Second) of Aqency 5 1 (1957)); Wolfe v. Schulz Refrigeration (1979), 188 Mont. 511, 517, 614 P.2d 1015, 1018. An agency relationship did not exist between the Taylors and respondents because the Taylors were not subjecttorespondents1control. Although respondentssupplied capital, the Taylors did not represent respondents in dealing with the Weingarts. As we determined above, respondentswere not general partners of C & W Taylor. The Land Sale Contract is between the Weingarts and I1CharlesR. Taylor and Wyman Taylor, co-partners, doing business as C & W Taylor Partnership.I1 The court did not err in concluding that respondents were not joint venturers with Charles and Wyman Taylor. The judgment of the District Court is affirmed.

# w Justice John C. Sheehy did not parti.cipatein thisdecision.