No. 86-187 

IN THE SUPREME COURT OF THE STATE OF MONTANA 

1987 

ROSS PULLIAM, 

Plaintiff and Appellant, 

-vsJAMES PULLIAM and FRED PULLIAM, 

d/b/a PULLIAM CONSTRUCTION, 

Defendants and Respondents. 

APPEAL FROM: District Court of the Fourth Judicial District, 

In and for the County of Ravalli, 

The Hon. Jack L. Green, Judge presiding. 

COUNSEL OF RECORD: 

For Appellant: 

Kammerer Law Offices; Clinton Kamrnerer, Missoula, 

Montana 

For Respondent: 

Garlington, Lohn & Robinson; Lawrence F. Daly, 

Missoula, Montana 

Submitted on Briefs: Jan. 22, 1987 

Decided: March 11, 1987 
Mr. Justice John Conway Harrison delivered the Opinion of the 

Court. 

This is an appeal from the District Court of the Fourth 

Judicial District, in and for Ravalli County, Montana. The 

appellant (Ross) appeals from a finding that he is not a 

one-third partner in Pulliam Construction with two other 

brothers. We affirm. 

Jim, Fred and Ross Pulliam are brothers. Jim and Fred 

formed Pulliam Construction, a partnership, in 1967, in 

Missoula, Montana. The two brothers acquired parcels of real 

property and began building both "spec" and custom houses. 

The two brothers agreed to share equally the profits, losses, 

ownership and management of Pulliam Construction. The 

partnership purchased a farm near Stevensville, Montana, as 

an investment in 1969. At the time of trial Jim had lived in 

the farmhouse since 1971. Each of the brothers drew whatever 

cash he needed for living expenses from the partnership 

account. 

Jim handled the record keeping and financial affairs of 

the business and Fred did the design layouts and prepared 

bids. The two brothers worked equally on construction 

projects, shared in the management of the business, dealt 

with subcontractors, financial institutions and customers. 

In 1971 Pulliam's mother arranged with Jim and Fred for 

a younger brother, Ross, to come to Montana from Missouri to 

work for their construction business for a while. Ross lived 

in Fred's house and began working as a laborer. He had no 

business or building experience when he began working, owned 

no tools or equipment, had no special skills, and no money to 

contribute to the partnership business. 

It was originally understood Ross would be working in 

Missoula for only about six months. During this time he was 
to be provided with a place to live, food and living 

expenses, with the agreement Jim and Fred would settle with 

him when he moved back to Missouri. Ross decided not to 

return to Missouri, however, and the living and compensation 

agreement was continued. None of the brothers received wages 

and there was no fixed rate of pay, but each had a drawing 

account. Ross's name was added to the partnership signature 

card allowing him to write checks on the Pulliam Construction 

account. 

In November 1971, Ross moved into the house on the farm 

property where Jim lived. Ross married in December 1974, and 

he and his wife lived there until they were divorced in June, 

1981. During this time everything Ross and his wife needed 

was provided by the partnership. Ross worked his last 

construction shift in May 1977, and became involved in 

various unsuccessful business enterprises. 

Ross filed a complaint in May 1981, alleging his 

brothers had excluded him from the partnership business and 

demanded, among other things, the partnership be dissolved 

and an accounting be had. After a bench trial, the court 

found that Ross was not a partner in Pulliam Construction and 

was not entitled to the relief sought. He appeals. 

Findings of Fact of the District Court will not be set 

aside unless they are clearly erroneous. Rule 52 (a) 

M.R.Civ.P. Nor will, 

[t] his Court . . . substitute its 

judgment for that of the trier of fact. 

We will consider only whether substantial 

credible evidence supports the findings 

and conclusions. Findings will not be 

overturned unless there is a clear 

preponderance of evidence against them, 

recognizing that evidence may be weak or 

conflicting, yet still support the 

findings. 
Round v. Reikofski (Mont. 1985), 699 P.2d 72, 74, 42 St.Rep. 

634, 636. 

Therefore, the only question before us here is whether 

there is substantial evidence to support the District Court's 

findings that a partnership did not exist between Ross and 

his two brothers. 

Under S 35-10-201 (I), MCA, "[a] partnership is an 

association of two or more persons to carry on as co-owners a 

business for profit." We have set forth the elements 

necessary to establish a partnership in Bender v. Bender 

(1965), 144 Mont 470, 480, 397 P.2d 957, 962: 

[Ilt is necessary to determine the intent 

of the parties; . . . There must be some 

contribution by each co-adventurer or 

partner of something promotive of the 

enterprise. There must be a joint 

proprietary interest and a right of 

mutual control over the subject matter of 

the enterprise or over the property 

engaged therein, and there must be an 

agreement to share the profits. 

See also First National Bank of Twin Bridges v. Sant (1973) , 

161 Mont. 376, 506 P.2d 835. 

Ross argues at least five indicia indicate that he was 

an equal partner: (1) the bank card signed by all three 

brothers ; (2) the Pulliam Construction ledgers which 

enumerate a separate drawing account for each brother; 

(3) the partnership K-1 tax returns for the years 1974-1978 

which are signed by each brother and which list Ross as an 

equal partner for purposes of sharing profits and losses; 

(4) the failure of Pulliam Construction to take any tax, 

accounting or record keeping steps which would indicate Ross 

was an employee, independent contractor or joint venturer; 

and (5) the absence of any time record for all three 
brothers which bears any correlation to hourly rate or to the 

amounts actually withdrawn from Pulliam Construction's funds. 

None of these, however, meets the test set out in 

Bender, supra, nor the statutory rules determining rights and 

duties of partners pursuant to 5 35-10-401, MCA. 

"No person can become a member of a partnership without 

the consent of all the partners." Section 35-10-401(7), MCA. 

Further, the intention of the parties must be clearly 

manifested. Bender, supra at 480, 397 P.2d at 962. The 

record shows no such manifestation. The only witness to 

testify there was an intention to form a partnership was Ross 

himself. 

The two witnesses produced by Ross in his case-in-chief 

did nothing to support his partnership claims. They were 

fellow workers who testified that Ross had never said he was 

an equal partner. One of the witnesses assumed he was a 

partner, but had not been told so. Jim and Fred's denial of 

intention was corroborated by other witnesses. 

Regardless of intention, there are certain acts which 

result in a partnership, or which negate the intention of the 

parties. 

Superimposed upon the rule of intent, it 

is frequently held that where there is no 

express agreement to form a partnership, 

the question of whether such a 

relationship exists must be gathered from 

the conduct, surrounding circumstances 

and the transactions between the parties. 

[Citations omitted. ] There is no 

automatic solution to the question of the 

existence of a partnership but it turns 

upon the facts and circumstances of 

association between the parties. 

[Citations omitted.] No single fact may 

be stated as the complete and final test 

of a partnership. [Citations omitted. ] 

Even a written agreement, designating the 

partners as partners and providing for a 
sharing of the profits, is only 

evidential and not conclusive of the 

existence of a partnership. 

P & M Cattle Co. v. Holler (Wyo. 1977), 559 P.2d 1019, 1022. 

In Truck Insurance Exchange v. Industrial Indemnity Co. 

(Mont. 1984), 688 P.2d 1243, 41 St.Rep. 1835, we found the 

acts of the parties created a partnership in fact, and 

contrary intentions of the parties were ignored. BY 

splitting the net profits equally, the parties established a 

prima facie case of partnership under S 35-10-401 (1) , MCA. 

In this case, where there is conflicting evidence the parties 

intended to form a partnership, the actions of the parties to 

the contrary defeats any inference a partnership existed. 

We find no evidence of an agreement to share the 

profits. The money which Ross was entitled to draw for his 

living expenses were as wages of an employee. 

The receipt by a person of a share of the 

profits of a business is prima facie 

evidence that such a person is a partner 

in the business, but no such inference 

shall be drawn if such profits were 

received in payment: 

(a) . . . 

(b) as wages of an employee . . . 

Section 35-10-202 (4), MCA. 

There is no evidence Ross contributed anything 

promotive of the enterprise, or that he had a proprietary 

interest or a right of control. As noted above, he had no 

business or building experience when be began working, owned 

no tools or equipment, had no special skills, and no money to 

contribute to the partnership business. He relied upon Jim 

and Fred to make all business decisions. He did not handle 

arrangements with subcontractors. Fred and Jim bouqht and 
sold numerous pieces of property during the time he was 

associated with them and his name never appeared on any of 

the documents of conveyance. He never dealt with any 

financial institution concerning the partnership loans. 

The District Court correctly found: 

[tlhere is conflicting testimony as to 

the intention to form a partnership, 

however the court hereby finds that there 

was no contribution by Ross Pulliam of 

something promotive of the partnership 

enterprise, that Ross Pulliam had no 

joint proprietary interest in or right of 

mutual control over the Pulliam 

Construction business enterprise or its 

assets, and that tax wise Ross Pulliam 

received a share of the net profits and 

losses of Pulliam Construction as payment 

as wages of an employee. That Ross was 

an employee of Pulliam Construction and 

upon termination of his employment was to 

be paid wages, less draws, and living 

expenses as set forth in paragraph XVII 

above. 

The decision of the District Court is affirmed. 

We Concur: I \