38 Town Associatesv.Barr

Appellate Division of the Supreme Court of New York, Second DepartmentMar 11, 1996
225 A.D.2d 613 (N.Y. App. Div. 1996)
225 A.D.2d 613639 N.Y.S.2d 442

March 11, 1996

Appeal from the Supreme Court, Westchester County (Nicolai, J.).


Ordered that the appeal from the order entered November 22, 1994, is dismissed, as that order was superseded by the order entered March 24, 1995, made upon reargument; and it is further,

Ordered that the order entered March 24, 1995, is reversed insofar as appealed from, upon reargument, the order entered November 22, 1994, is vacated, and the defendants' motion to dismiss the complaint is denied; and it is further,

Ordered that the plaintiff is awarded one bill of costs.

The plaintiff, a partner of the defendants, brought this action to recover the proceeds of an alleged loan made to the partnership. The defendants moved to dismiss the action, asserting, in essence, that the alleged loan was in fact a capital contribution. The Supreme Court granted the motion to dismiss.

The Supreme Court erred in granting the motion to dismiss. The partnership agreement does not by its terms clearly rule out loans by partners to the partnership. Accordingly, its provisions are subject to interpretation and inquiry as to the intent of the partners who entered into the agreement. For that reason, summary judgment is inappropriate (see generally, Jackson Hgts. Med. Group v Complex Corp., 222 A.D.2d 409; Icon Motors v Empire State Datsun, 178 A.D.2d 463; see also, Hynes v Barr, 225 A.D.2d 588 [decided herewith]).

Moreover, apart from the terms of the agreement, there are questions of fact as to whether the monies advanced were either loans or capital contributions based on the surrounding circumstances and the conduct of the parties (see, e.g., BenDashan v Plitt, 58 A.D.2d 244). Rosenblatt, J.P., Ritter, Copertino and Goldstein, JJ., concur.