Opinion ID: 2616451
Heading Depth: 1
Heading Rank: 1

Heading: The Appropriate Legal Standards

Text: As partners or joint venturers, plaintiffs and GP owed one another a duty of loyalty, fair dealing and full disclosure in all matters affecting the conduct of the venture's business. Starr v. International Realty, 271 Or. 396, 403, 533 P.2d 165 (1975); Dean Vincent, Inc. v. Russell's Realty, 268 Or. 456, 466, 521 P.2d 334 (1974); Fouchek v. Janicek, 190 Or. 251, 262, 225 P.2d 783 (1950). This duty continued throughout the parties' relationship. In Fouchek v. Janicek, supra 190 Or. at 273, 225 P.2d at 793, we said:    The obligation of partners to act with the utmost candor and good faith in their dealings between themselves is not lessened by the existence of strained relations between them or the existence of any condition which might, in and of itself, justify the firm's dissolution. The fiduciary obligations of a partner remain until the relationship is terminated.   . Some question has been raised about the effect of the incorporation of MPI upon the parties' fiduciary obligations. The corporation was formed for purposes of facilitating dealings with outsiders, and was not intended to place the parties to the joint venture on an arms-length basis with one another. Of course, to the extent that the articles of incorporation, bylaws, and shareholders' agreement specifically alter the parties' rights and duties, these later documents control over the earlier joint venture agreement. They do not, however, purport to dissolve the fiduciary relationship. Whether we consider the corporation as organized to carry out the purposes of a continuing joint venture, [4] or simply regard the parties as equal owners of a close corporation, their relationship was such that each was entitled to the other's performance of fiduciary duties of loyalty, good faith, and full disclosure. Baker v. Commercial Body Builders, 264 Or. 614, 629, 507 P.2d 387 (1973). We agree with the trial court that some of the alleged breaches by GP, whether or not they were in fact violations of duty under the appropriate legal standard, did not result in any ascertainable damage to MPI. This opinion will not, therefore, discuss all of the parties' charges and countercharges. We will deal only with the matters which we consider necessary to an understanding of our disposition of the case.