Larry Buhman opened an upscale cigar shop called "The Smoke Ring." Buhman became dissatisfied with his partner's performance and decided to terminate the relationship. James McGaughy, who previously had been working part-time at The Smoke Ring, accepted what he believed was Buhman's oral offer to make him the new partner, but their agreement was not reduced to writing and its terms are hotly disputed. The parties agree only that McGaughy was to manage the store and was promised a 40 percent share of the profits with a guaranteed minimum of $2,000 per month. It is also undisputed that for several years McGaughy and Buhman used business cards that identified each as "Owner" of The Smoke Ring. Buhman paid for the cards. McGaughy identified himself as an owner or a partner in the business to his friends and family, and did so in Buhman's presence without correction. The Smoke Ring was also repeatedly reorganized into various business structures for tax advantages as directed by Buhman. At one time, the business was organized as a partnership, and Buhman identified McGaughy to the Internal Revenue Service as the owner of a 1 percent partnership interest; however, Buhman claimed 100 percent of the deductions arising from the business on his personal tax return. Later, Buhman became dissatisfied with McGaughy's performance and informed him that his employment was terminated. McGaughy sued Buhman to recover his share in the partnership he believed to exist. Buhman argued that there was no partnership agreement supported by consideration and that McGaughy was a contract laborer receiving 40 percent of the profits at the time he was terminated. Was McGaughy a partner of The Smoke Ring? Why or why not?
Answer to relevant QuestionsPhillip Heller was a partner of the Pillsbury, Madison & Sutro law firm. The relationship between Heller and the firm was not strong, as Heller's work performance was unsatisfactory. He billed 1,000 hours fewer than he had ...How is an ultra vires act related to a corporation's powers? 10. The plaintiff commented that the defendants "intentionally or recklessly failed to disclose a change in Japanese regulations that predictably reduced demand for the corporation's products and services in Japan, a ...Meadows worked as an assistant manager at a Dollar General store. While she was ringing up an order for a customer, he became verbally abusive. After she finished ringing up the sale, the customer threw the bag, containing a ...As part of its ongoing efforts to uncover overhyped health claims in food advertising, the Federal Trade Commission issued an administrative complaint charging the maker of POM Wonderful 100% Pomegranate Juice with making ...
Post your question