No. 84-167 INTHE SUPREME COURT OF THE STATE OF MONTANA 1985

INTHE MATTER OF THE ESTATE OF ROBERT R. PALMER, Deceased.

APPEAL FROM: 

### District Court of the SixthJudicialDistrict, Inand fortheCounty of Park, The Honorable Byron Robb, Judge presiding.

COUNSEL OF RECORD:

For Appellant: Hooks & Budewitz; Patrick F. Hooks argued, Townsend, Montana Moore, Rice, O'Connell & Refling; Perry J. Moore, Bozeman, Montana

For Respondent: Drysdale, McLean, Screnar & DiRe; Roger Scouten & James McLean argued, Bozeman, Montana



## - Submitted: May 23, 1985 Decided: October 21, 1985

Filed: 

## OCT2.ij985Mr. JusticeFred J. Weber delivered the Opinion of theCourt. A motion 

### to determine the existence of a joint tenancy

was filed intheprobate proceedings in theDistrict Court of Park County. An appeal was taken from the order determining that the checking account, cattle, cattlebrands and brokerage account did not pass to the surviving partner in his capacity as surviving joint tenant. We affirm the District Court. The issues are: 1. Did the District Court 

### err inholding thatthebank checking account in the names of William Palmer and Robert Palmer asjoint tenantswas partnershipproperty? 2. Did the District Court 

### err in holding that the cattlebranded with a brand registered in the names of "William Palmer or Robert Palmer" 

### were partnership property? 3. Did theDistrictCourt 

### err inholding thata brokerage account, registered in the name of William Palmer for which Robert Palmer signed a document asa joint tenant, was partnershipproperty? Following are pertinent facts contained in the uncontested findings of factof the

### District Court. Robert Palmer (Robert) died on November 8, 1981. For many years prior 

### to Robert's death, he and his brother, William, operated and conducted a partnership called "Palmer Brothers." The partnership was engaged in the business of raising livestock and feed, conducting a feedlot operation, and buying and selling cattle on ranchlands about 10 

### miles northeast of Livingston inPark County, Montana. William and Mildred, hiswife, resided on the ranch formany years prior to Robert's death, while Robert resided in Livingston. Robert married Constance on September 21, 1979, and Constance 

### is Robert's sole heir at law. For many vears prior toRobert's death, Robert and William owned a checking account in First Bank Livingston, in which they deposited a31 

### receipts and the proceeds from cattle sales and other income, and from which they paid all partnership debts and obligations. Additional facts

### willbe 

### set forth in our discussion of the checking account issue. William and Brad Palmer, son of William, claimed the proceeds 

### in the checking account at the time of Robert's death as surviving joint tenants. Constance contends thatthebalanc~ 

### is a partof thepartnership assets and should be accounted for in the partnership. Because of the 

### - orbrand certificate, William claims that the brands and any cattlecarrying them passed to

### him as surviving joint tenant, and toMildred as his successor in inter

### est. Constance claims the property 

### is part of the partnership's assets and should be accounted for in the partnership. 

### In 1979, William opened a commodity orbrokerage account with Merrill Lynch. William claims the Merrill Lynch account as his sole property, or as surviving joint tenant if the account 

### is found tobe joint, while Constance claims the account 

### ispart of thepartnershipassets. The District Court pointed out that William testified thathisrelationshipwith Robert was very close and they got along

### wellboth as friends and asbusiness partners until the last few years of Robert's life, when hispersonality changed and he did erratic things. Constance testified that Robert and William 

### were not friendly for several years before Robert

## 's death, although she acknowledged that Robert named William aspersonal representative inhis 1977

### will. Another brother, Maro Palmer, testified that Robert had told him William was trying to take the business away from him and that Robert's behavior had not changed until a few weeks before death. Brad Palmer testified thatWilliam and Robertgot along well with only normal disagreements until the last year or so when Robert became unable tomake decisions and lost hisjudgment. A neighboring rancher testified that the brothers got along 

### well and he never saw any disagreement. The DistrictCourt found that thepartnership income tax returns for 1972 through 1981, with 1974missing, showed that the partnership paid all of the expenses of operating the ranch, including huge sums for purchasing and feeding livestock, interest on loans, taxes, vet carp and trucking, from the Palmer Brothers' checking account; that all partnership income, includingprofits from cattle sales, was deposited in that account; and that the partners split equally any net profits or losses. The 

### District Court further found that neitherbrother had any individual source of income. The evidence established that the bank account was opened in joint tenancy form in 1947, and the Palmer Broth

### ers' partnership commenced business in 1949. Following Robert's death on November 8, 1981, Rrad Palmer was appointed aspersonal representative of hisestate under Robert's 

### willof February 7, 1977. Constance, as sole heir of Robert, petitioned the court to terminate the appointment of Brad as personal representative. She was appointed aspersonal representative of theestateof Robert on February 24, 1982, and continued in that capacity. William filed a petition todetermine joint tenancies in the probate proceeding. A hearing was held, testimony was submitted and evidence was introduced by both sides. By Order Ruling on Motion dated March 7, 1984, the District Court denied the motion of William todetermine the checking account, cattle, cattlebrands and brokerage accounts passed tohim as surviving joint tenant. The court further determined that allof such

### itemsof personal propertywere thepartnershippropertyof Palmer Brothers and 

### weretobe accounted forby William as surviving partner, or his successors, to Constance, the personal representative of Robert's estate. William and Mildred, his wife and successor, appealed from the Order.

The issues presented require us to consider the provisions of the Uniform Partnership Act as adopted in 1947. Because there are few Montana caseswhich constituteauthority on the legal issuesbefore us, 

### we have found 

### it necessary to review the historical. background of partnerships and partnership property. John Coll.yerls

## - A Practical Treatise on the Law of Part

## ----- nership, originallypublished inEngland in 1832, contains an illuminating discussion of the historyof the law of partnership which was 

### well developed by cases in both England and the United States by 1830. Based upon a number of English and American cases cited 

### in the footnotes, the treatise discusses the treatment of partnership property upon the death of one partner. The analysis 

### i.s a clear forecast of the Uniform Partnership Act approach asdeveloped almost 100 years later: From what has been already observed asto the want of survivorship among partners, 

### it follows, that, upon thedecease of one of several partners, his share o+ the movable stock and effectsof thepartnership, subject to the partnership debts, devolves tohispersonal representatives, who thereupon become, both at law and in equity, tenants in common with the surviving partners. Although, for the purpose of encouraging trade, 

### it 

### is held that the harsh doctrine of the jus accrescendi, which 

### is an incident of joint tenancy atthecommon law, does not apply tothepartnership property, yeton the decease of one of the partners, as the surviving partner stands chargeable with the whole of the partnership debts, the interest of the partners in the partnership property shall be deemed so far a joint tenancy as to enable thesurvivingpartner totake thepropertyby survivorship, forallpurposes of holding and administering the estate, until the effects are reduced to money and the debts are paid. When the debts are all paid, the effects of the partnership reduced tomoney, and thepurposes of the partnership accomplished, the surviving partner shall be held toaccountwith the representatives of the deceased for his just share of the partnership funds. J. Collyer, A Practical Treatise on the Law of Partnership 

## - ---- § 129, at 117-18 (4th Amer. ed. 1853) (hereinaftercited as Collyer). In substance, this provides that upon death of a partner, his share of partnership property, subject topartnership debts, passes to his personal representative who becomes a tenant in common with the surviving partner. Further, because the survivingpartner 

### ischargeable with the whole of the partnership debts, the surviving partner 

### is deemed to take the property by survivorship in order to administerthepartnership. Finally, when thedebts arepaid and the partnership purpose 

### is accomplished, the surviving partner must account to the personal representative of the deceased partner for his just share of that which remains. The cases referred to in Collyer emphasize the contradiction between the cases decided in equity courts, where forms of ownership did not control, and courts of law, where the form of ownership of property astenants in common or as joint tenants with right of survivorship controlled. In a partnership, even though the property was held as joint tenants, inequity survivorshipwould notbe allowed notwithstanding the form of the deed. The treatise states as follows: Where lands are conveyed to certain persons, asjoint tenants, for the purposes of a trade or an adventure, in * equity there 

### will be no survivorship in 

# --- such property, notwithstanding the form of the conveyance.Collyer, 

### S 134 at122 (emphasis supplied). The textd~velops thistheory further, statingat

### 5 135: The rules and principles by which part

### ners hold real estate, purchased by them with partnership funds and for partnership purposes, have been considerably discussed in America, 

# . .. Several late decisions in Massachusetts have established the doctrine for that State, that when real estate 

### is purchased by partners, with the partnership funds, for partnership use and convenience, although 

### it is conveyed to them in such a manner as to make them tenants in common, yet, in the absence of an express agreement, 

## -- -- or of circumstances, showing an intent 

## - that-such estate shall be heldfortheir 

## -- --- separate use, 

### it 

### will be considered and 

### - 

## --- 

# - treated, in equity, asvesting in them in 

### --- their parFnership capacity, clothed with an implied trust, thatthey shallhold 

### it until-the purposes for which 

### it was so purchased shall be accomplished, 

# . .

# . Upon the dissolution of the partnership, by the death of one of thepartners, the survivor has an equitable lien on such real estate forhisindemnity againstthe debts of the firm, and for securing the balance that may be due to him from the deceased partner, on settlement of the partnership accounts between them; and the widow and heirs of such deceased partner have no beneficial interest in such real estate,

# .

# ..until the surviving partner 

### is soindemnified. Collyer, 

### S 135 at 123-24 (emphasis supplied). The use of equitable principles to disregard the legal form of joint tenancy ownership or tenancy in common ownership was clearly stated inthe case of Hoxie v. Carr (1832)

## , 1 Sumner 173, by Mr. Justice Story: 

### "In cases where the real estate 

### is purchased for partnership purposes, and on partnership account, 

### it 

### iswholly immaterial, in the view of a court of equity, in whose name or names the purchase 

### is made, whether of one partner or all; whether inthe name of a stranger, orof one of the firm. In eithercase, let the legal titlebe vested inwhom 

### it may, 

### it 

### isinequitydeemed partnership property, and the partners are the cestuis 

### que trust. A court of law may, nay, must, view 

### it, in geveral, only according to the legal 

### title."See Collyer, § 135, at125. This doctrine that realproperty acquired withpartnership funds

### willbe regarded inequity as partnership property was affirmed in Connecticut and Virginia. The author emphasizes that these principles are founded

on sound policy and obvious justice and that their correctness appears incontestable. Joseph Story, in hisCommentaries on the Law of Partner

## ---- ship, stated the rules under which partnership real and personal property areheld by the survivingpartner astrustee notwithstandinq legal title: But, however the titlemay stand atlaw, or in whosesoever name or names 

### it may be, the real estate belonging to the partnership

### willinequityhe treated, as belonging to the partnership, like 

### its persona1 funds, and disposable and distributable accordingly; and the parties, in whose names 

### it stands, as owners of the legal 

### title, 

### will be held to be trustees of thepartnership, and accountable accordingly tothepartners, according to their several shares and rights and interests in the partnership, 

### as cestuis 

### que trust, or beneficiaries of the same. Hence in equity, in case of * - the death of one partner, there 

### is no survivorship in the real estate of the partnership; but his sharewillgo tohis proper representatives

# . . . Upon thispoint there has been a diversityof judicial opinion, 

# ... some judges holding, that in such a case 

### it retained 

### its original character of real estate, and passed to the heirs or devisees accordingly; and others holding, that 

### it was tobe treated throughout, aspartnership property, and therefore as personalty, and belonged tothe executor or administrator. The doctrine under these circumstances must be considered, asopen tomany distressingdoubts. J. Story, Commentaries on the Law of Partnership §§ 93 & 94 

## ---- at138-40, (5th ed. 1859) (hereinaftercited as Story). As

### isapparent, thedoctrinewas not universally accepted. Nonetheless Joseph Story further concluded that therewas no reason to distinguish between realty and personal property so farasthepartners areconcerned: Nor 

### is there in reality, as between the partners themselves, 

### any difference, whether the partnership property, held for the purposes of the trade or business, consists of personal or movable property, orof real orimmovable property, or of both, so far astheir ultimate rights and interests therein are concerned. Story, $ 92 at137. This rationalewas restatedby James Kent in 1873: (2) Stock in Land--If partnership capital be invested in land for the benefit of the company, though 

### it may be a joint tenancy in law, yet equity 

### will hold 

### it tobe a tenancy incommon, and asforming part of the partnership fund; and the 

## -- better opinion would 

### seem to be, that 

## --- equity 

### will consider the person in whom the legal estate

### isvested astrustee for the whole concern, and the property will be entitled tobe distributed aspersonal estate. 3 J. Kent, Commentaries "37 (emphasis supplied). In our present case, Will-iambased his claim primarily

on the form of ownership of the joint tenancy checking account and thewording contained ina brand certificate. Had this case been considered in England or the United States prior to 1900, the predominant 

### view would have been that leqal 

### title alone could not control and that equity would properly consider the assets tobe under the control of the survivingpartner forpurposes of winding up thepartnership, with William's claim being limited tohis share of the partnership assets afterthewinding up and dissolution. The foregoing 

### is a summary of the law of the United States in existence at the 

### time of the promulgation of the Uniform Partnership Act in 1914. That Act was adopted in Montana in 1947. We

### will now 

### review the pertinent portions of theUniform PartnershipActasadopted inMontana.Section 35-10-203, MCA, contains a critical definition of partnership property: Partnership property. (1) All property originally brought into the partnership stock or subsequently acquired by purchase or otherwise on account of the partnership 

### is partnership property. (2) Unless the contrary intention appears, property acquired with partnership funds 

### ispartnershipproperty. Constance contends that under this section, allof the property in question was acquired with partnership funds and 

### is therefore partnership property. Section 35-10-501, MCA, spells out the property rights of a partner: Classification of property rights 

## of a partner. The

# propertyrights of a partx ner are: (I) his rights in specific partnership property; (2) hisinterest inthepartnership; and (3) his right to participate in the management. It then becomes necessary toconsider the nature of a partner's interest in specific partnership property. The nature of a partner's rights in specific partnership property 

### is spelled out in

### S 35-10-502, MCA: (1) A partner 

### isco-owner with theother partners of specificpartnership property holding asa tenant inpartnership. (2) The incidents of this tenancy are such that: (a) A partner, subjecttotheprovisions of this chapter and to any agreement between the partners, has an equal right with the other partners to possess specific partnership property for partnershippurposes but has no righttopossess such property for any other purpose without the consent of the other partners.(d) On the death of a partner that partner's right in specific partnership property 

### vests in the surviving partner.



# ... Such survivingpartner orpartners



# .

# .. has no right topossess the partnership property for any but a partnershippurpose. 

### (e) Provided the proceeds of a deceased partner's 

### interest are included in the assets of the decedent's estate, such property 

### is not subject toa lien of the surviving spouse for his orher 

### elective share or a lien for or allowances to surviving spouses, heirs, ornext of kin. The nature of the partner's interest in the partnership 

### is his share of profits and surplus. Section 35-10-503, MCA, provides: Nature of partner's interest in the partnership. A partner's interestTn partnership 

### is his share of the profits and surplus and the same 

### is personal property. The dissolution and winding up of the partnership are also controlled by the Act. Section 35-10-602, MCA, states: Partnership 

## - not terminated dissolution. On dissolution the Qartnershi~ 

### is not terminated but continkes until the winding up of partnership affairs 

### is completed. With regard to the causes of dissolution which are pertinent for this case, 

### S 35-10-603 (4)

### , MCA, specifies that "the death of any partner" 

### is a cause fordissolution of the partnership. In thepresent case, thedeathof Robert caused

a dissolution of thepartnership. With regard to the winding up of the partnership by William assurvivingpartner, 

### S 35-10-609, MCA, states: Right 

# to wind 

### 9. Unless otherwise aqreed, the partners who have not wronqfully dissofved the partnership or the legal representative of the last surviving partner, not bankrupt, has the right to wind up the partnership affairs. However, any partner, his legal representative, or his assignee, upon cause shown, may obtain winding up by the court.Following a dissolution, a partner has a right tohave partnershipproperty applied todischarge partnership liabilities and the surplus paid 

### in cash to the respective partners. Section 35-10-610, MCA, statesinpertinent part: Rights 

## of partners after dissolution to a~~lication of ~artnershi~ ~ro~ertv or

## to -- cLhtinue busineks. (1) hhen ;'lissglution 

### is caused in any way, except in contravention of the partnership agreement, each partner as against his copartners and ailpersons claiming through-them in respect of their interests in the partnership, unless otherwi-se agreed, may have <he partnership property applied to discharge 

### its liabilities and the surplus applied to pay in cash the net amount owing to the respective partners. 

# . .. Section 35-10-612, MCA, 

### sets forth the rules for 

### settling accounts and distribution after dissolution. 

### In substance, ashere applicable, the assetsof thepartnership are to be applied first to the creditors of the partnership, second to any liabilities owing to the partners other than for capital and profits, third to partners in respect of capital and lasttothepartners in respect of profits. With this background, we 

### willnow consider the specific issues raised by the parties.

Did the District Court err in holding that the bank checking account in the names of William Palmer and Robert Palmer asjoint tenantswas partnership property? The District Court's findings show that at Robert's death, FJil'l-iam and Robert owned a checking account inwhich they deposited all receipts and proceeds from cattle sales and allother income and fromwhich they paid allpartnership debts and obligations, including checks to themselves for salary and other profits. The checks and deposit slips for the account were identified onlv as "Palmer Brothers." The signature card for that account was signed by William andRobert in 1947 upon forms showing that this was a joint tenancy account with rights of survivorship. The checking account was the sole hank account used by the partnership. Several yearsbefore Robert's death, Brad Palmer alsoexecuted the signature card. As a result, there

### were three signatures shown on thecard atthe

### timeof Robert's death. In arguing thatthe court erred inholding that thebank account was not joint tenancy property, William argues that under State Board of Equalization 

### v. Cole (1948), 122 Mont. 9, 195 P.2d 989, the signing of a joint tenancy signature card 

### is sufficient to 

### settle the intent on the part of the donor to make a gift in a joint tenancy. Following that case, William 

### relies upon Casagranda 

### v. Donahue (1978), 178 Mont. 479, 585 P.2d 1286 

### in which this Court stated that where intention 

### is clearly expressed on the face of the signature card, additional evidence 

### isunnecessary. William also 

### relies on the recent case of Anderson v. Eaker (1382), 196Mont. 49, 641 P.2d 1035, where 

### we held that statements on signature cards 

### were not conclusive where a depositor during her lifetime raised the issue of the ownership of the funds in a joint tenancy account. We therefore concluded that additional evidence may be examined toascertainthetrue intentof the parties. InAnderson, the depositor had made written demand for the return of the deposit books and had filed suittoquiet

### titletothe funds prior to the depositor's death. William then argues that the proper conclusion should be that the signaturecard 

### is determinative of intent to create a joint tenancy unless one party raised the issueby affirmative action duringhis lifetime. William points out that the record does not show any affirmative act

on thepartof Robert toterminate thejoint tenancy priortohis death, and therefore concludes that the joint tenancy in thechecking account should be upheld. Constance in turn contends that there 

### is substantial evidence to support the findings of the District Court that

a11 of themoneys in the account 

### were partnership funds, and that the account was used exclusively formore than 30 years

as the only partnership account. Citing Jensen 

### v. Jensen (Mont. 1981), 629 P.2d 765, 38 St.Rep. 927, and Speer v. Speer (Mont. 19821, 654 P.2d 1001, 39 St.Rep. 2204, Constance argues that the court 

### will not substitute 

### its judgment for the

### trier of fact, and 

### wewillconsider onlywhether substantialcredible evidence supportsthe findings and conclusions, leaving the credibility of witnesses and weight accorded to theirtestimony tothe District Court. Our 

### review of theevidence disclosesthatthere

### is clear and substantial evidence to support the findings on thepart 

### of the District Court. As a result, 

### we agree with the conclusion of the DistrictCourt thatthe checking accountwas a partnership checking account and that the funds in the account 

### were partnership funds. This 

### is consistent with § 35-10-203, MCA, which provides that property acquired with partnership funds 

### is partnership property. As a result, 

### we also conclude that the partnership account 

### is tobe classed

as specific partnership property under the provisions of § 35-10-501, MCA, and following sections. William contends that the evidence 

### is insufficient to

overcome the joint tenancy form of the account ascreated in 1947 by the signature card. We do not agree with that contention. Partnership property by 

### its very nature must be treated differently than property of individuals. Section 70-1-306, MCA, states there are three types of ownership of property by several persons:The ownership of property by several persons 

### iseitherof: (1) joint interests; (2) partnership interests; (3) interests incommon. As pointed out inthe historyregardingpartnership property, the rule established in courts of equity after several hundred years of experience was todisregard the form of ownership of property acquired by partners and treat property acquired by thepartnershipwithpartnership funds asproperty of the partnership. That certainly 

### is the foundation for provisions of the Uniform Partnership Act such as 

### S 35-10-203, MCA, which provides that all property acquired by purchase or otherwise on account of the partnership 

### is partnership property. That conclusion 

### is strengthened by 

### 5 35-10-502, MCA, which provides that a partner 

### isa co-owner of specific partnership property holding as a tenant in partnership. In the present fact situation, Robert's share in specific partnership property vested in William upon Robert's death, and William had no right to possess the partnership property "for any but a partnership purpose." This contradicts the suggestion that the surviving partner becomes the owner of theproperty by survivorship in his own right and independent from thepartnership. Succeeding sections spell out how a surviving partner must apply funds from a partnership account tovarious liabilities of the partnership. After the partnership liabilities have been discharged, the surplus 

### isdivided between the partners. In this case, the surplus would be distributed one-half to the persona1 representative of Robert's estate and the remaining one-half to the successor in interest of William.It

### isclearthatthe incidentsof theproperty rights in the bank account as a tenant in partnership are directly contradictory to the rights which a joint tenant with right of survivorship has in a joint tenancy account. Although 

### 5 35-10-203, MCA, specifies that property acquired with partnership funds 

### is classed aspartnershipproperty "unl~ss the contrary intention appears," 

### we conclude that the 1947 execution of a joint tenancy signature card does not constitute sufficientevidence of a contrary intention. That would have been an appropriate conclusion over 100 years ago and 

### is consistentwith theprovisions of theUniform Partnership Act today. We affirm the holding of the District Court that the checking account did not pass to William and Brad, as the survivingjoint tenants. 

### I11 Did the District Court 

### err in holding that the cattle branded with a brand registered in the names of "William Palmer orRobert Palmer" 

### werepartnershipproperty? William argues that because the cattle brands 

### were registered 

### inthe name of William 

## - orRobert, a joint interest

was created, resulting in joint tenancy ownership of the cattlethemselves. In 

### its findings of fact, the DistrictCourt pointed out that Robert and William owned two livestock brands which originally were registered toWilliam 

### - and Robert. In 1971, the brands 

### were changed 

### to William 

## - or Robert. The court found that during Robert's lifetime thepartn~rs branded all of the partnership cattlewith one orthe other of these two brands, and that all of the cattle 

### were acquired through partnership funds.Weconclude that the same rationale applies here aswith the checking account. Here 

### it 

### is clear that the cattle

### were acquired with partnership funds and are to be classed as partnership property, unless a contrary intention appears. William Palmer contends that his testimony evinces a contrary intention: Q. Bill, what 

### is your understanding of the nature of the ownership of these brands that you had with Bob, did you hold them as ioint tenants orastenants incommon? A. Joint tenants. Q. What 

### is your understanding of the effect of a joint tenancy ownership of property? A. That 

### we had them, and in case one person, the survivor, had the total. Q. Can you tellme what word orwords in the registration certificate indicate to you that the brands 

### were held as joint tenants rather than tenants in common? A. Orrather than and.

Q. Can you tell 

### mehow thatword came to be there? A. Yes. That was put there rather than and so ifanythinghappened toone orthe 

## - other 

### it would go to the surviving person. Notwithsta-nding the wording of the brand certificate, the 

### District Court found William Palmer's testimony inconsistent and unbelievable. Conclusion of law E states: It 

### is anomalous and inconsistent for William Palmer tocontend: (1) thatthe partnership assets of little value belonged tothe firm, but thatthose having any considerable value 

### were owned as joint tenantswith right of survivorship; and (2) that assets purchased with partnership funds and used by the firm were not partnership property.The District Court concluded that 

### it was the intent of the partners that the partnership property would not pass tothe survivingjoint tenant. Conclusion of law C states: It was the apparent intent of the partners, William and Robert Palmer, as determined from theiractions and theuse made of the checking account, cattle, cattle brands and brokerage accounts, that such property was and continued to be partnership assets, that 

### it did not pass to William J. Palmer as surviving joint tenant, but must be accounted for forthwith to the persona1 representative of Robert's estate 

### inthe winding up and dissolution of thepartnership. Wehold there 

### is substantial credible evidence tosupport the court's conclusions. We affirm the order of the 

### District Court which determined that the cattle and cattle brands were partnership property. 

### IV Did the District Court errj.n holding that a brokerage account, registered in the name of William Palmer for which Robert Palmer signed a document as a joint tenant, was partnershipproperty? William argues that the opening information sheet for thebrokerage account demonstrated thatWilliamwas tobe the

owner. He further points out that Robert and William's signatures appeared on a "Authorization to Transfer Customer's Segregated Funds" injoint ownership form, indicatingan intention on both of their parts thatthebrokerage accounts

were tobe joint accounts. We find it unnecessary tosettle this factualquestion. The 

### District Court found that the original deposits to the original account aswell as all subsequent deposits

### were made with funds withdrawn by William from the partnership checking account and not from any of William's personalmoney. That finding 

### is not disputed. In addition, the court found there was no evidence to indicate Robert ever made similar or equal withdrawals toestablish brokerage accounts

or other investments in his individual name. We again conclude that as tothebrokerage account, asproperty acquired with partnership funds, 

### it became partnershipproperty unless

a contrary intention appears. William failed to show such a contrary intention. We conclude that

### mere form of ownership of thebrokerage account, either in the name of William alone or in the name of William and Robert asjoint tenants, would not be sufficienttoshow such a contrary intention. Following the rationale established for the other property, 

### we affirmtheorder of theDistrict Court in

### itsdetermination that the brokerage accounts 

### were partnership property and did not pass to William as a surviving joint tenant. We also affirm the holding of the District Court that all of the above-described 

### items of property are determined tobe partnership property of Palmer Brothers which aretobe regularly accounted for by the surviving partner, or his

successor in interest, tothepersonal representative of the estateof Robert.

Weconcur:

Chief Justice

### Justices

### Chief JusticeJ. 

### A. Turnage dissenting: I would reverse the District Court and hold that on November 8, 

### 1981, the date of Robert Palmer's demise, his interest in the checking account, cattle and cattle brands passed to his brother, William Palmer, by right of survivorship. The majority opinion states that § 

### 35-10-203, MCA, contains a critical definition of partnershipproperty: Partnership property. (1)All property originally brought into the partnership stock or subsequently acquired by 

### purchase or otherwise on account of the partnership is partnership property.

(2)

### Unless the contrary intention 9- 

# - pears, property acquired with partner- funds is partnership 

### p 

## _shie.

. 

### - 

### roperty

# .

[Emphasissupplied.] The provision set forth in subparagraph (2)

## ,under the facts of this case, is not only critical but controls. The joint tenancy with right of survivorship checking account between Robert and William was established in 1947 and the two livestock brands were registered in the names of William or Robert as joint tenants with right of survivorship in 1971. 

### There could be no clearer evidence that Robert and William intended to pass this property by right of survivorship. Theprovision of § 

### 35-10-203(2), MCA,has clearly been satisfied and their contrary intention has been established. If thepartnershad intended to hold thisproperty other than

as joint tenants with right of survivorship they could have accomplished this by the simp1.e act of closing the bank account and reestablishingthe accountas oneheld by them as tenants in common; likewise, the livestock brands certifi-

### cates could.have been reissued designating them as tenants in

common. In Montana holding title to property in joint tenancy with right of survivorship is not only common throughout the State but is also a very important and convenient manner in which owners of property may hold title thereto, and it provides a convenientmethod that offers certainty as towho will succeed to the property upon demise of a joint tenant as well as providing a less expensive means of transferring the decedent's property without expense of probate. Most certainly, many owners of partnership ranch, farm and small business in Montana have utilized the joint tenancy with right of survivorshipmethod of holding property. The majority opinion wil-1invite uncertainty and doubt

as to the right of ownership to this property upon the demise of one of the joint tenant with right of survivorshipowners, which in turn will invite litigation thatmost.certainlywill follow. This case should be reversed and remanded with di.rections to enter an order determining that the checking account, livestock and livestock brands passed by right of survivorshiptoWilliam Palmer.

Chikf Justice

Mr. JusticeL. 

### C. 

### Gulbrandson: I 

### join in the dissent of Mr. Chief Justice Turnage.Mr. Justice Frank B. Morrison, 

### Jr., dissenting: Counsel forappellant and respondent have focused on the question of whether the assetshere involved arepartnership assets. Such a determination 

### isnot dispositive. Because the parties have presented the case to the DistrictCourt on the issue of whether the disputed property

was partnership property or joint tenancy property, the District Court decided the case without addressing the true issue. This Court, in 

### its majority opinion, does deal with the issue upon which the case turns, but, 

### in my opinion, erroneously 

### relies upon ancient authority. The question involved in this case 

### is whether partnershipassetscan be placed ina bank account sothat, upon the death of one partner, the assets 

### will go by survivorship to theotherpartner. The clearweight of American authority 

### is that partnership assets can be passed by survivorship. I will concede thatJohn Collyer's, 

## - A Practical Treatise

## -- on the Law of Partnership, originally published inEngland in 1832, 

## -- is generally supportive of themajority's position. Further support may he found in Hoxie v. Carr (1832), 1 Sumner 173, 12 Fed.Cas. 746. The textual reference and the case authority involve real estate. However, the majority correctly notes that J. Story, Commentaries on the Law of 

## ---- Partnership, assertsthatthe same law applies topersonalty. This treatise, the most modern authority cited by the majority opinion, was published in 1859. At the time that majority's treasured treatises 

### were published, Blacks were chattels and women could neither own

nor convey real estate. I find 

### it useful to examine some

cases decided in thiscentury. Districtof Columbia 

### v. Riggs National Bank of Washington, D.C. (D.C.App. 1975)

## , 335 A.2d 238, stands fortheproposition thatpartnership property canhe leftby a survivorship. In that case, Waverly and Lulie Dickson, brother and 

### sister, formed a partnership in 1935. Waverly predeceased his 

### sister by three years. When Lulie died, the partnership books carried three savings accounts, with deposits totaling $11,036.65, as partnership assets. Those funds were on deposit in the names of Luli~ and Waverly, asjoint tenants. In holding that those assetsbecame Lulie's by right of survivorship on Waverly's death, the District of Columbia Courtof Appeals stated: The UPA 

### sets forthrules fordistributing a partnership's personalty 

# ... after dissolution. D.C. Code 1973, 

### SS 41-328 to 41-342. The method 

### set forth there, however, 

### is not exclusive. Subject to the rights of creditors, and in the absence of fraud, partners may agree to a distribution of the property on dissolution which 

### is different from that which would obtainunder theUPA inthe absence of an agreement. See Ensor

### v. Ensor, 270 Md. 549, 554, 312X2d 286, 289 (1973); Anderson v. Anderson, 215 Md. 483, 488-89, 138A.2d 880, 883 (1958);Wallner v. Schrnitz, 239 Finn. 93, 95-96, 57 N.W.2d 821, 823 (1953).

In this case, there 

### is absolutely no evidence to refute the intent of the partners to leave their funds in joint tenancy with right of survivorship. The account itself provides evidence that they did in fact intend 

### to leave the funds in such a manner. When the evidence stands unrefuted, the survivorshipdisposition must be respected. The 

### District of Columbia court, in F.jjggs National Bank, supra, addressed thisquestion and said: We conclude that if partners maintain savings accounts as joint tenants, and there 

### is evidence that they understood theconsequences of joint tenancy, effect will be given 

### to the right of survivorship. [citationsomitted]Also, there 

### is no indication that Lulie and Waverly--both astute business people--did notunderstand and intend the survivorship consequences of joint tenancy.

The case of Stroh

### v. Dumas (Vt. 1951), 84 A.2d 408, 

### is factually very similar to the case atbar. William Pelton and John Dumas formed a partnershiptoengage inthebusiness of buying and selling cattle. The initial money for the partnership was provided by Pelton in 1938, and deposited in

a checking account entitled llW. H. Pelton, Special Account." In 1943, Pelton and Dumas signed a signature card stating 

### "W. H. Pelton (SpecialAcct) subject towithdrawal of either and payable to survivor W. H. Pelton, John H. 

### Dumas June 11, 1943. l1 The partnership continued overthenext several-years todeposit 

### its funds in and pay 

### itsbil1.s from that account. Upon PeltonIs death, the Supreme Court of Vermont held that the checking account became the 

### sole property of the survivingpartner, Dumas, stating: No rights of creditors are involved. As between themselves, the partners had the right to make such disposition 

### of the partnership property asthey deemed fit. 40 Am.Jur. 373; 47 C.J. 770; 68 C.J.S. Partnership, 575, page 515; Hunter 

### v. Allen, 174 Or. 261, 267, 284, 147 P.2d 213, 148 P.2d 936; Ottaviano 

### v. JJorenzo, 1-69 Md. 51, 179 A. 530, 534, 535; Green 17. Whaley, 271 Mo. 636, 651, 197 S.W. 355; Sargent

### v. Blake, 8 Cir., 160 F. 57, 64, 17L.R.A., N.S., 1040, 1046; Upson 

### v. Arnold, IS Ga. 190, 63 Am.Dec. 302; Lefevre's Appeal, 69 Pa. 219, 8 Am.Rep. 299, 233; Crane on Partnership 392; Gilmoreon Partnerships 128. The Uniform PartnershipActrecognizes thisright 

## - and provides thatthe intention and agreement 

## -- of the parties 

### is tocontrol. [emphasis 

### -- 

## -- supplied.]

Other cases which are generally supportive of this position areHirsch

### v. Bartels (Fla. 1950), 49 So.2d 531, andBailes 

### v. Bail~s(Ark. 1977), 549 S.W.2d 69. I have been unable tofind any American cases inthe last 100 

### years that support themajority's position here. This case should be reversed and remanded with directions to enter a declaratory order determining that the subject joint tenancy funds passed by right of survivorship.