Opinion ID: 1911789
Heading Depth: 1
Heading Rank: 4

Heading: harley's withdrawal from partnership

Text: On September 19, 2001, Harley sent Don a letter and stated that he was withdrawing from the partnership: Therefore, pursuant to Section 11[a] of the Partnership Agreement . . . this letter constitutes notice that we withdraw from the partnership effective 90 days after the date of this notice. Don retained attorney Peter Katt, and Harley retained Alan Slattery. On October 1, 2001, Katt e-mailed Slattery that he would respond to Harley's letter within 30 days. On October 30, Katt wrote Slattery that section 12 of the agreement, regarding the appraisal of a withdrawing partner's interest, applied only if the partners did not agree on the value of the interest. He stated that the parties should attempt to agree on the value before selecting an appraiser. On November 1, Slattery responded that the appraisal process in section 12 applied only if Don elected to continue the business by December 20, 2001, the effective date of Harley's withdrawal. He further stated that if Don made that election, Harley would participate in the valuation process. But if Don failed to elect to continue the business by December 20, then D & H would be dissolved. On November 9, 2001, Katt wrote Slattery that he agreed Harley's withdrawal was effective December 20. He also agreed that if Don did not elect to purchase Harley's interest, then section 14 of the agreement applied regarding termination and liquidation of D & H. He stated Don would advise Harley whether he elected to purchase Harley's interest by December 15, provided [Harley' provides us with a value for his interest on or before December 1, 2001. Katt also suggested moving the effective date to December 31 for accounting and tax purposes. On November 14, 2001, Katt and Slattery met to discuss the value of Harley's interest and the possibility of Harley's purchasing Don's interest instead. On November 28, Harley offered to purchase Don's interest for $1.15 million. On December 6, responding to an inquiry from Slattery, Katt e-mailed Slattery. He stated he was working on a `business continuation proposal and that he was still waiting for a response to his suggestion that the parties extend the deadlines under the agreement. The next day, Slattery responded that he would not extend any deadlines unless the parties have made all agreement, or if it appears the parties are likely to reach an agreement. On December 13, Katt wrote Slattery that Don was declining Harley's offer to purchase Don's interest and that Don was electing to continue the business. Katt stated that although Harley's offer had been based on an appraiser's fair market value of D & H, selling would cause Don a substantial loss of annual income. Katt again asked for the price that Harley would be willing to accept for his 50-percent interest.