Opinion ID: 537185
Heading Depth: 4
Heading Rank: 5

Heading: $165,000 owed for defaulted Associate interests

Text: 88 The district court held that Cascade had not accounted for $165,000 in royalty payments that Cascade and Interphase owed to the Joint Venture in connection with Cascade's 1982 purchase of 4 1/2 units of defaulted Associate interests and Interphase's purchase of one defaulted unit. In Cascade's responses to Gold Technics' accounting interrogatories, Cascade produced photocopies of checks and bank records showing that it indeed had paid $135,000 into the Joint Venture's bank account and that Interphase had paid $30,000. (R. 322 Exh. TJV 13.) 89 On appeal, the Gold Technics Defendants do not challenge Cascade's assertion that checks totalling $165,000 were deposited into the Joint Venture's bank account, but rather contend that Cascade failed to submit any evidence of the source of the funds purportedly transferred. (Gold Technics Br. at 9, emphasis in original.) The Gold Technics Defendants ask rhetorically, what 'payment' is there if $135,000 of the Associates' or [the Joint Venture's] funds are taken by Cascade and then checks written by it back into [the Joint Venture]? (Id.) 90 Despite Gold Technics' point, we conclude that the $629,474.63 awarded by the district court double-counts the $165,000. The $165,000 payment could have come from only two sources: either from the Joint Venture or from non-Joint Venture sources (or a combination thereof). If it came from non-Joint Venture sources, then the Joint Venture is entitled to receive only $464,474.63 ($629,474.63 less $165,000) because only $464,474.63 was wrongfully transferred from the venture. On the other hand, if the $165,000 came from the Joint Venture, then the venture still is entitled to only $464,474.63 because $165,000 of the $629,474.63 taken from it was repaid. 91 Therefore, because the evidence shows that Cascade and Interphase in fact paid $165,000 to the Joint Venture, the accounting award should be reduced from $629,474.63 to $464,474.63, and the Gold Technics Defendants should receive their proportionate share of the smaller sum. 92