Singer v. Singer

Rule of Law:

Partners may, through a specific and unambiguous provision in a partnership agreement, contractually eliminate their fiduciary duty not to compete with the partnership or one another.

Facts:

• The Singer family operated a long-standing oil production partnership called Josaline Production Co.
• The 1962 and 1977 Josaline partnership agreements contained an identical clause stating each partner was free to enter into business for their own account, even if it competed with the partnership, 'as if he or she were not and never had been members of said partnership.'
• Defendants Stanley Singer and Andrea Singer Pollack were partners in Josaline.
• At a Josaline partners meeting on July 25, 1979, the potential purchase of a 95-acre property known as the IDS land was discussed, but the decision was deferred.
• Prior to the meeting, Joe L. Singer, another partner, had asked Stanley Singer to investigate the possibility of purchasing the IDS land.
• On September 25, 1979, Stanley Singer and Andrea Singer Pollack formed their own partnership, Gemini Realty Company, and purchased the IDS land without consulting the other Josaline partners.
• After learning of the purchase, Joe L. Singer demanded that his separate partnership, Singer Bros., be allowed to purchase 50% of the property from Stanley and Andrea.

Procedural Posture:

• Joe L. Singer, Singer Bros. partnership, and MT Partnership sued Stanley Singer and Andrea Singer Pollack in district court.
• The trial court imposed a constructive trust on the purchased land, finding that it should be held for the benefit of Josaline Production Co. and the Trachtnberg family, who were not parties to the lawsuit.
• The trial court also ruled that the beneficiaries of the trust were not required to reimburse Stanley and Andrea for the interest costs they incurred to acquire the property.
• Defendants Stanley Singer and Andrea Singer Pollack appealed the trial court's judgment to the Oklahoma Court of Appeals.