Friday, November 22, 2013

Smith v. Kelley case brief

Smith v. Kelley case brief summary
465 S.W.2d 39 (1971)

Appellant employee sought review of a judgment of the trial court (Kentucky), in favor of appellees partners in an action seeking a partnership accounting.

The employee worked for the partners and received a salary plus travel expenses. At the end of each year he was paid a relatively small additional sum as a bonus out of the profits of the business. After the employee discontinued his employment with the partners, he claimed that he was entitled to a fixed percentage of the profits, and commenced the instant action for an accounting. The trial court held that no partnership existed and dismissed the claim.


  • On appeal, the court found that the conduct of the parties over a three-and-one-half-year period confirmed the conclusion that, though the employee was held out to the public as a partner, between themselves a partnership relationship was not intended to be and was not created. 
  • Additionally, there was no writing evidencing a partnership agreement.

The court affirmed the trial court's judgment in favor of the partners.

Recommended Supplements for Corporations and Business Associations Law

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