220-52 Associates v. Edelman

Order, Supreme Court, New York County (Stuart Cohen, J.), entered October 29, 1997, which, inter alia, after a non-jury trial, determined that defendant and plaintiff Edward Edelman were equal partners in plaintiff 220-52 Associates, affirmed, without costs.

The evidence at trial supports the court’s conclusion that the parties never reached a meeting of the minds on the allocation of partnership assets. Inasmuch as this conclusion rests on the court’s evaluation of the credibility of the witnesses and of the weight to be accorded to the admissible evidence, we will not disturb its findings (see, Jose R. v Blanche M., 220 AD2d 222).

Defendant argues that the trial court erred in not relying on certain documentary and other evidence supporting his testimony that he and his father, plaintiff Edward Edelman, had orally agreed that defendant was entitled to 90% of the equity in the partnership. However, none of the cited evidence was conclusive as to the central issue, and we find nothing improper in the court’s decision to reject it.

Specifically, the evidence included proof of distribution to defendant over a period of 13 years of 90% of the income and refinancing proceeds from the partnership, entries on financial statements and tax returns reflecting the 90/10 split and some evidence that defendant had made a payment to his father in the amount of $90,000 which, he testified, was meant to compensate his father for 80% of his father’s 50% share, leaving defendant, who already owned 50% with a 90% share of the total partnership.

However, division of income along certain lines does not establish conclusively that the equity in the partnership is divided in the same proportion (see, Christal v Petry, 275 App Div 550, 557, affd 301 NY 562). Here, plaintiff father testified that he agreed to his son receiving a 90% share of the income in order to enhance his son’s income. Thus, while this circumstantial evidence may indicate that defendant may have trusted that his father would acknowledge his ownership of 90% of the business, as the trial court found, it did not conclusively show that his father had actually committed himself to a particulár allocation of the assets. Moreover, in light of the many financial dealings between the parties, the evidence that a payment was made to plaintiff by defendant of $90,000 does not establish that the payment was in compensation for additional equity in the partnership. Furthermore, particularly in light of the family relationship involved, the failure to actually come to a specific agreement is neither as surprising nor unusual as it would have been had the parties had a purely business arrangement. Under these circumstances, the court was entitled to accept plaintiff Edward Edelman’s testimony that there had been no such agreement and find that the precise rights of father and son in the partnership had remained ambiguous and unstated.

In light of its finding that there was no actual agreement to the contrary, the trial court properly held that the partnership assets would be distributed equally (Partnership Law § 40). Concur — Rosenberger, J. P., Ellerin, Williams and Saxe, JJ.