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Thomas v. King

Supreme Court of Delaware

October 30, 1953

THOMAS
v.
KING et al.

Suit for a partnership accounting. The Court of Chancery, 95 A.2d 822, entered judgment dismissing the complaint with prejudice, and plaintiff appealed. The Supreme Court, Tunnell, J., held that the evidence sustained chancellor's finding that plaintiff had failed to sustain the burden of proving existence of a partnership.

Affirmed.

[34 Del.Ch. 161] Appeal from a judgment of the Court of Chancery denying plaintiff a partnership accounting, the court having found that plaintiff had failed to sustain the burden of proving the existence of a partnership.

Affirmed.

Max Terry and Henry J. Ridgely, of Dover, and Joseph W. Starlings and Eldridge Hood Young, of Baltimore, Md., for appellant.

David F. Anderson, of Wilmington, and (on the brief) Caleb M. Wright, of Georgetown, for appellees.

TUNNELL, Justice, RICHARDS, President Judge, and HERRMANN, Judge, sitting.

TUNNELL, Justice.

Prior to the events with which this action is concerned, the plaintiff, Thomas, was employed as an engineer in the United States Corps of Engineers, and one of the defendants, John Rodney King (hereinafter called simply ‘ the defendant’ or ‘ King’), was a member of a firm of contractors doing marine salvage work and was also engaged individually both in sales distribution of explosives and in construction blasting.

Late in 1947, when Thomas was about to be released from government employment, or early in 1948, after his release, Thomas and King had one or more conferences, as a result of which the two parties entered into some sort of an arrangement for working together in the future. Just what kind of an arrangement it was is the central question in this case. Thomas says that it was an agreement of equal partnership and that, as an extension or alter ego of this partnership, there was to be a corporation, to be called ‘ Viking Engineering Company’, in which each of these parties would own one-half of the capital stock. King, on the other hand, says that their understanding was simply that he was to give Thomas a job. The two versions of what transpired are in utter conflict, and each of the parties points to facts and deeds which he interprets in

Page 779

such a way as will accord only with his particular theory of the arrangement.

[34 Del.Ch. 162] Without putting their working agreement, or any feature of it, into writing, the parties, in March or April, 1948, began to work together and proceeded to complete five contracts or subcontracts, from which Thomas alleges that there was a net profit in excess of $100,000. Then, in November of 1949, King ordered Thomas to leave a job then in progress; he left; and their business relationship, whatever it had been, was severed.

In the meantime, King's attorney had formed a Delaware corporation called ‘ Viking Engineering Company’ . No stock had ever been issued in the corporation, though, and it never was organized or qualified to do business.

So long as plaintiff and King had worked together, plaintiff had received the sum of $500 per month. King, of course, claims that the money thus paid was salary. ...


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