G. W. GONZALEZ AND HARRIET N. SAUNDERS, EXECUTRIX, APPELLANTS,
v.
O. H. SMITH, APPELLEE
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In a partnership accounting dispute over a steamship venture, the Florida Supreme Court affirmed the lower court's allowance of a $25/month operating expense to the managing owner Smith while denying the same amount to partner Gonzalez, interpreting the partnership agreement to provide such allowances only when the boat generated profits.
The court affirmed the lower court's decision, holding that the agreement should be interpreted to provide the $25/month allowance only out of earnings or profits, and that in the entire absence of profits, no allowance to the owners was required. However, Smith's allowance was properly allowed as an operating expense for book-keeping and incidental office costs.
“It is conceded that a managing owner of a boat is not in the absence of an agreement to that effect, entitled to a salary as such.”
Establishes that managing owners have no inherent right to compensation unless the partnership agreement provides one.
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Join FLexlaw to unlock all legal intelligenceThree partners—Saunders (managing owner), Gonzalez, and Smith—entered into a written agreement whereby Gonzalez and Smith would each receive $25/month…
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Cockrell, J.
This is an appeal from a decree in a partnership accounting, allowing a certain claim of O. H. Smith, the managing owner of a steamship and refusing an item claimed by G. N. Gonzales.
It appears that E. E. Saunders, now deceased, one of the three partners was the managing owner, much dissatisfaction existed, especially upon the part of G. W. Gonzalez, who with difficulty prevailed upon Smith to assume the burden. An agreement under the seals of all three partners was then executed, whereby in the nature of a compromise settlement with the retiring managing owner Saunders, it was stipulated that Gonzalez and Smith were each to receive from the earnings of the steamboat twenty-five dollars per month for three years, and that then “the net profits from earnings of said steamboat outside of the amounts above mentioned” should be equally divided among the three partners, and Saunders assumed personally certain liabilities against the boat.
The venture proved a failure, resulting in continual losses, until the boat was by mutual consent of all parties sold.
• The court allowed Smith twenty-five dollars-a month, in the nature of an operating’ office expense and refused to allow Gonzalez twenty-five dollars a month claimed by him under the articles of agreement.
We do not see exactly how Saunders’ representative should be heard to complain that Gonzalez was not allowed his claim, and if he be allowed it under the agreement, certainly Smith stands equally under the contract with Gonzalez. The instrument is not happily worded, but we cannot isay that the master and judge both erred in the concurrent construction that the word “earnings” of the boat interpreted in the light of the immediately following paragraph, meant “profits,” and that in the entire absence of “profits” there should be no allowance to the owners.
It is conceded that a managing owner of a boat is not in the absence of an agreement to that effect, entitled to a salary as such. The allowance here is however more in the nature of an operating expense, being largely consumed in the incidental office expense of book-keeping and the like; an allowance that had been uniformly recognized by these partners during the previous changes in the management, and tacitly recognized in Smith, after he assumed control, in that frequent statements to the other partners were from time to time rendered, showing this item charged, and without objection.
Upon the whole record we are unable to see sufficient error to justify a reversal, and the decree is accordingly affirmed.
Shackleford, O. J., and Taylor, Hocker and Whitfield, J. J., concur.
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Emelina C. Tellez v. Callejas, 683 So. 2d 175 (Fla. 3d DCA 1996)…ement to the contrary, a partner may not receive separate remuneration for services performed for the partnership. Sections 620.645(6), 620.8401(8), Fla.Stat. (1995); Beckerman v. Greenbaum, 439 So. 2d 233, 237 (Fla. 2d DCA 1983); Gonzalez v. Smith, 66 Fla. 85, 86, 62 So. 913, 914 (1913); Unif. Partnership Act § 401(h) (1994), 6 U.L.A. 52 (1995); Unif. Partnership Act § 18(f) (1914), 6 U.L.A. 526 (1995); 59A Am.Jur.2d Partnerships § 483 (1987 & Supp. 1996); 68 C.J.S. Partnerships § 94 (1950). Here, no evi…