Small v Harrison [2004] NSWSC 612

Small v Harrison [2004] NSWSC 612

A non-consenting partner whose partnership funds have been applied, without consent, by another partner to the purchase of real property is entitled to an equitable interest in the property proportionate to the contribution of partnership funds, and may seek a declaration to that effect to facilitate appropriate orders in the winding up of the partnership.

Parties
Plaintiff: Christopher Gerard Small; Defendant: Noel Elliott Harrison
Jurisdiction
Australia
Judgment Date
07 July 2004
Procedural Posture
Equity Partnership Dispute / Separate Question Determination; Declarations Made Ex Tempore
Outcome
Declarations made; orders entered; further directions given; costs reserved.
Legal Topics
Use of Partnership Assets, Fiduciary Duty, Dissolution and Winding Up of Partnership, Partnership Property, Resulting Trust, Tracing Partnership Property
Partnership Equity Use of Partnership Assets Fiduciary Duty Dissolution and Winding Up of Partnership Partnership Property Resulting Trust Tracing Partnership Property

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Parties

Christopher Gerard Small

Plaintiff

Noel Elliott Harrison

Defendant

Procedural Posture

Equity Partnership Dispute / Separate Question Determination; Declarations Made Ex Tempore

Legal Issues

  1. 1 What rights does a non-consenting partner have concerning real property purchased with partnership assets by the other partner without consent?
  2. 2 Whether application of partnership funds to purchase real property in one partner's name, without consent, gives rise to an equitable interest for the partnership

Ratio Decidendi

A non-consenting partner whose partnership funds have been applied, without consent, by another partner to the purchase of real property is entitled to an equitable interest in the property proportionate to the contribution of partnership funds, and may seek a declaration to that effect to facilitate appropriate orders in the winding up of the partnership.

Court Disposition

Declarations made; orders entered; further directions given; costs reserved.

Orders

  • Declaration that at least $28,938.69 of partnership money was applied by the defendant without the plaintiff's consent towards the purchase price of 207 Prince Street, Grafton.
  • Declaration that the defendant holds his interest in 207 Prince Street, Grafton (subject to the mortgage) subject to an equitable obligation to treat a proportionate interest not less than the ratio which $28,938.69 bears to the total purchase price as an asset of the partnership.