Court Opinion

ID: 6973850
Source: CourtListenerOpinion
Date Created: 2022-07-24 02:07:26.24784+00
Date Added: 2024-06-11T16:08:54.145039
License: Public Domain

Mr. Justice Vickers delivered the opinion of the court: Appellant’s contention is, that his action in withdrawing from the firm on June 30, 1903, amounted to a dissolution of the co-partnership, which he contends carries with it the right to an accounting, including the division of the profits to that date. Appellees insist that while he had the right to withdraw from the firm, yet his action in so doing did not amount to a dissolution of the co-partnership, and that because he withdrew before the expiration of the five-year period mentioned in the contract he lost his right to such participation in the profits. We do not find it necessary at this time to determine whether one partner may voluntarily dissolve a partnership without cause when the right so to. do is not provided for in the contract. That right, we think, is clearly reserved in the contract here under consideration by the following clause: “It is agreed" by and between the parties hereto that if either said Onstott or Tandy wishes to retire from the business at the end of any year, the remaining partners will return to him the amount of cash he shall have paid in up to that date as part payment for said interest, and shall return to him any unpaid notes that he may have given in part payment for said interest, but no interest is to be paid upon the principal that he may have advanced for such purpose. It is also agreed that such notice of withdrawal must be made in writing to each of the other members of the firm at least ten days before the 30th of June, which shall be deemed to be the end of the business year.” It is admitted that Onstott complied with this provision in the contract by giving notice and exercising his right of withdrawal at the time specified. It is true, there was a provision that the partnership should continue for a period of five years, but we regard this as a limitation fixed for the duration of the contract in case no one withdrew before the limitation expired. There are provisions in the contract whereby others might withdraw. It is obvious from the above stipulation that Onstott had the right, under the contract, to withdraw in the way and at the time that he did. It is contended that the withdrawal of Onstott from the firm did not work a dissolution of the partnership. To this proposition we cannot agree. In McCall v. Moss, 112 Ill. 493, this court, in passing upon the case, used the following language (p. 501) : “We understand the rule to be, that when one partner dies or sells his interest to another, or a new member is admitted by purchase of a portion of the capital owned by one or more members of the firm, such will, in law, work a dissolution of the firm. Parsons on Partnership (p. 406, sec. 1,) states the law as follows : Tt may now be considered as a settled rule of the law of partnership, in England and in this country, that the retirement of one partner from a firm consisting of any number of persons operates as a dissolution of that firm. * * * We suppose the truth to be, that if a partner retires, whether by voluntary act, bankruptcy, expulsion or death, or if a new partner comes in by any means whatever, in either of these cases the old partnership ceases to exist.’ ” (See, also, Edens v. Williams, 36 Ill. 252; and for a later case, Pease v. Dawson, 197 id. 340.) In this case the contract provided that in case Onstott chose to withdraw his interest was to be purchased by the other members of the firm. He did withdraw and they offered to purchase his said interest, proposing to pay therefor the amount specified in the contract. Onstott’s withdrawal evidently dissolved the partnership, and the partnership being dissolved he was entitled to an accounting, and it was proper to include in the accounting a division of the profits up to June 30, 1903. The amount of the decree is not involved. The judgment of the Appellate Court is reversed and the decree of the superior court of Cook county is affirmed. Judgment reversed.