ÿWPC] …4Vj 0(y¡w@© 0Jé 0T3 0^‡ 0hå 0rM 0|¿ 0†; 0Á 1uQ 0dÆ UB* %l U6r U>¨ B)æ DC AMR U*Ÿ É v~× BUvÓr D3E 0@x AO¸Æ 0DÍ D/ B@¥Hœ$ÔøÔô3|x¶($¡¡ ¤D¥¦E§¨D©Dª«D¬U­Ó€2 ÿÿ0Indent1Ô2ÔÔ3  Ô2" ÿÿ0Indent2à0 àÔ2ÔÔ3  Ô2, ÿÿ0Indent3à0 àà0 àÔ2ÔÔ3  Ô26 ÿÿ0Indent4à0 àà0 àà0 àÔ2ÔÔ3  Ô2@ ÿÿ0Indent5à0 àà0 àà0 àà0 àÔ2ÔÔ3  Ô2J ÿÿ0Indent6à0 àà0 àà0 àà0 àà0 àÔ2ÔÔ3  Ô2T ÿÿ0Indent7à0 àà0 àà0 àà0 àà0 àà0 àÔ2ÔÔ3  Ô2^ ÿÿ0Indent8à0 àà0 àà0 àà0 àà0 àà0 àà0 àÔ2ÔÔ3  Ô  ÿÿ?AGMSYaioIndent0I.A.1.a.(1)(a)i)a)P ÿÿ8Mac DefaultMac DefaultÓ ` °šXÓ<þ6X9`(*Courier 12pt10cpiX< Œ 9p`(Courier New< Œ 9p`(&Times New Roman% Line 7 d7Border 1dd€- Cþÿ << Gÿÿ< Œ 9p`(Arial Ý ƒ!ÝÑ  ÑÑ#€d#ÑÔ€ÔÝ  ÝÔ€"ÔÔ€"ÔÓ  Óò òÔ YYY ÔFILEDÔ€"XÔÌÌAugust€5,€1998ÌÌCecil€W.€CrowsonÌAppellate€Court€ClerkÔ  Ôó óPtPtHHÚ(ÿáÿâùFG(üHHÚ(d'h dStyl{WP}01•ÃÃÃÃÃÃÃÃÃÃÃÃÃÃÃÃÃÃà Ãà Ãà Ãà Ãà ÃÃÃÃÃÃÃÃÃÃÃÐ ÐÐHHÐÐ  ÐÐ2ÐÐÿÿ¸æ$ÿÐÐHHÐÐÐÐÐÐÐÐ  ÐÐ ÐÐ ÐÑÑÑGenevaÑÑ ÑÑ € ÑÑ<Px–ÈÑÒÒÒ443!#4ÒÒ$ *$ÒÒ$*$ÒÒ ÿKK ÒÒ  Geneva ÒÒ  Geneva ÒÓ.,ÓÓÓÓ6ÓÓ ÓßßßßßßßßßßßßßßßßßßÑGenevaÑÑ ÑÒ  h HD: Geneva ÒÒ  h HD: Geneva Ò%%%%'ÿÿdxd("ÿÿ$££Ò  ÒÒ  Ò€-‚ƒCþÿ<< CÿÿƒLevel 1Level 2Level 3Level 4Level 5($$””ò òÚ  Ú1Ú  Úó ó„„'÷ÿ dxdüÿP PdÝ ƒ!ÝÔ . ÔÔ€ÔÝ  ÝÒ Ü ÒÒ ° ÒÑ ý ÑÑ  ÑÑ Ü ÑÑ\R AØ'\ÑÑ7€úXXdÈdÈ7ÑÔ€ÔÔ€ŠÔò ò›œÙ€€ÙßR€!# A1-j|` ç `€€@ÿRßÞ ÞÌÌÌÌ›à@ àó óÌR.S.€BRANDT,€K.M.€LUNDIN,à àà àœ)›ÌM.I.€LUNDIN,€N.B.€LUNDIN,à àà à)Ìand€A.T.€WILTSHIRE,€JR.,à àà àœ)›Ìà àà àà àà àà àà àœ)€Appeal€No.›Ìà àPlaintiffs„Appellees,à àà àœ)€01A01„9708„CH„00431›Ìà àà àà àà àà àà àœ)Ìv.›à àà àà àà àà àà àœ)€Lawrence€ChanceryÌ›à àà àà àà àà àà àœ)€No.€5965„92›ÌBIB€ENTERPRISES,€LTD.,€Aà àà à)ÌTennessee€Limited€Partnership,à àà à)Ìand€GREGORY€SMITH,€Individually,à à)Ìand€VIRGINIA€ABERNETHY,à àà àœ)€€›Ìà àà àà àà àà àà àœ)€€›Ìà àDefendants„Appellants.à àà àœ)€›ÌÌÌœÌò òà@ àIN€THE€COURT€OF€APPEALS€OF€TENNESSEEó óÌà0 àà àà@ àò òAT€NASHVILLEó óÌÌÌÌAPPEALED€FROM€THE€CHANCERY€COURT€FOR€LAWRENCE€COUNTY€ATÏLAWRENCEBURG,€TENNESSEE.ÌÌTHE€HONORABLE€WILLIAM€B.€CAIN,€CHANCELLORÌÌ›ÌWILLIAM€S.€FLEMING,€œFLEMINGÌHOLLOWAY,›€FLYNN€&€SANDS,€œP.CÌ207€West€Eighth€StreetÌColumbia,€TN€38401Ìà àFor›€Plaintiffs„Appellees.ÌÌHENRY,€HENRY,€STACK,€GARNER€&€SPEER,€œP.C.Ì119€South€First€StreetÌPulaski,›€œTN€€Ìà àFor›€Defendants„Appellants.ÌÌÌÌœÌò òà@ àAFFIRMED€AS€MODIFIED,€AND€REMANDEDó ó›Ìœà à̛̜à àà àà àà àà àà àà àò òHERSCHEL€P.€FRANKS,€JUDGEÌó ó›ÌœCONCUR:€€ÌGODDARD,€P.J.ÌMcMURRAY,€J.›ÌÌÓÓà àà àThis€cases€involves€a€dispute€over€a€limited€partnership.€€BIBÏEnterprises,€Ltd.€(ð ðBIBðð)€was€formed€on€December€30,€1982€for€the€stated€purposeÏof€acquiring€real€estate,€equipment€and€other€personal€property€of€a€BonanzaÏRestaurant€in€Lawrenceburg,€Tennessee.€€Defendant„appellant€Greg€Smith€wasÏnamed€General€Partner.à àÌà àà àOn€December€31,€1982,€BIB€entered€an€agreement€with€DineroÏEnterprises,€Inc.€for€the€lease€of€BIBððs€real€and€personal€property.€€In€November,Ï1994,€Dinero€defaulted€on€the€lease.€€BIB€entered€a€lease€with€Southeast€Restaurants,ÏInc.€(ð ðSoutheastðð)€on€January€1,€1985.€€In€late€1985,€the€Bank€of€Loretto,€which€hadÏfinanced€BIBððs€purchase€of€the€Bonanza€Restaurant,€failed€and€was€taken€over€byÏthe€F.D.I.C.€€BIB€purchased€its€note€from€the€F.D.I.C.€at€a€discount.€€The€money€toÏpurchase€the€note€was€provided€by€a€bridge€loan€from€Dominion€Bank.€€SmithÏnegotiated€permanent€financing€through€Community€Bank€and€Trust.Ìà àà àIn€1991,€Southeast€filed€for€bankruptcy.€€After€securing€a€new€tenant,ÏSmith€arranged€to€sell€the€property€at€auction.€€The€auction€was€held€on€August€18,Ï1992.€€Smith€purchased€the€property€for€$242,500.00.€€Ìà àà àThe€Plaintiffs„appellees€filed€suit€against€BIB€and€Greg€Smith€onÏDecember€3,€1992,€alleging€that€the€sale€of€the€partnership€property€to€Smith€wasÏvoid€and€requesting€an€accounting.€€The€Plaintiffs€later€amended€their€complaint€toÏadd€additional€defendants€and€further€alleged€that€Smith€breached€his€fiduciaryÏduties€and€committed€acts€of€embezzlement€and€misrepresentation.€€On€November€14,Ï1994,€the€Plaintiffs€moved€for€Partial€Summary€Judgment€on€the€issues€of€which€lawÏgoverned€the€transactions,€the€sale€of€the€partnership€property€and€Smithððs€renewalÏof€his€contract€for€management€services.€€On€February€15,€1995,€the€trial€court€filed€aÏMemorandum€of€Summary€Judgement€finding€that€the€sale€of€the€assets€was€null€andÏvoid€and€that€the€Uniform€Limited€Partnership€Act€governed€the€dispute.€€The€trialÏcourt€entered€its€Order€on€the€Motion€for€Partial€Summary€Judgment€on€March€7,Ï1995.Ìà àà àThe€parties€sought€an€interlocutory€appeal,€which€was€denied.€€After€aÏtrial€on€the€remaining€issues,€the€trial€court€issued€an€opinion€on€October€29,€1996.€ÏThe€trial€court€determined€that€Smith€had€no€authority€to€extend€his€baseÏmanagement€fee€beyond€the€terms€of€the€original€agreement.€€The€trial€court€alsoÏdetermined€that€the€Southeast€equipment€deal€and€the€F.D.I.C.€discount€did€notÏcount€as€compensable€sources€of€income€for€Smith.Ìà àà àThe€October€29€memorandum€adjudicated€all€issues€up€to€the€purportedÏsale€of€the€restaurant€on€September€10,€1992.€€The€trial€court€held€an€additionalÏhearing€on€June€17,€1997€in€order€to€adjudicate€all€remaining€issues.€The€trial€courtÏdetermined€that€Smith€owed€the€partnership€$53,516.77.€€The€trial€court€also€foundÍthat€the€Plaintiffs€were€not€entitled€to€a€judgment€against€Smithððs€wife,€VirginiaÏAbernathy.€€The€trial€court€denied€Plaintiffsðð€request€for€attorneyððs€fees,€discretionaryÏcosts€and€prejudgment€interest€and€ordered€the€dissolution€of€the€partnership.ÌÓ  Óà àà àÓ  Óà àà àThe€trial€court€properly€determined€that€the€UniformÏLimited€Partnership€Act€(ð ðUniform€Actðð)€governed€this€case.€€œAppellants›€œcontend›Ïthat€the€Revised€Uniform€Limited€Partnership€Act€(ð ðRevised€Actðð)€is€œapplicable.›€€TheÏrecord€does€not€contain€any€evidence,€however,€that€the€œAppellants›€made€theÏnecessary€election€to€be€governed€by€the€Revised€Act.Ìà àà àThis€issue€was€decided€by€summary€judgment.€€Summary€judgment€isÏappropriate€only€if€there€are€no€genuine€issues€of€material€fact€and€the€moving€partyÏis€entitled€to€judgment€as€a€matter€of€law.€Tenn.R.Civ.P.€56.03.€€If€both€the€facts€andÏthe€conclusions€to€be€drawn€from€the€facts€permit€a€reasonable€person€to€reach€onlyÏone€conclusion,€summary€judgement€should€be€granted.€òòShadrick€v.€Cokeróó,€963ÏS.W.2d€726€(Tenn.€1998)(citations€omitted).à àÌà àà àThe€partnership€in€this€case€was€formed€in€1982.€€At€that€time,€theÏUniform€Act€was€the€governing€law.€€T.C.A.€ðð€61„2„1204€provides€in€part:ÌÓÓà8 àà0 à(c)€Except€as€provided€in€subsection€(e),€a€limited€partnershipÏformed€prior€to€January€1,€1988€shall€continue€to€be€governedÏby€chapter€2€of€this€title€in€effect€prior€to€the€adoption€of€chapterÏ2€of€this€title€as€hereby€repealed,€except€that€such€limitedÏpartnership€shall€not€have€its€term€extended€except€under€thisÏchapter€.€.€.€Ìà8 àà0 à(e)€Any€limited€partnership€formed€prior€to€January€1,€1989,€andÏany€foreign€limited€partnership€may€elect€to€be€governed€by€thisÏchapter€before€July€1,€1989€by€filing€with€the€register€of€deedsÏprior€to€January€1,€1989€and€with€the€secretary€of€state€on€orÏafter€January€1,€1989€a€certificate€of€limited€partnership,€or€anÍapplication€for€registration€as€a€foreign€limited€partnership€whichÏcomplies€with€this€chapter€or€a€certificate€of€amendment€whichÏwould€cause€its€certificate€of€limited€partnership€to€comply€withÏthis€chapter€and€which€specifically€states€that€it€is€electing€to€beÏso€bound€and€by€paying€the€fee€for€a€certificate€of€limitedÏpartnership€specified€in€ðð€61„2„1207(a)(8).€€Such€certificate€mayÏbe€filed€by€any€general€partner€without€the€necessity€ofÏobtaining€the€approval€of€any€limited€partner.ÌÌÓÓà àà àIn€this€case,€there€is€no€evidence€that€the€Appellant€made€the€necessaryÏelection€to€be€governed€by€the€Revised€Act.€€The€only€evidence€of€an€election€isÏcontained€in€the€affidavit€of€an€expert€witness€who€stated€that€the€appropriateÏdocuments€were€prepared€for€filing.€€There€is,€however,€no€evidence€that€theÏdocuments€were€actually€filed€or€that€any€fees€were€paid€in€compliance€with€theÏstatutory€requirements.€€Thus,€the€trial€court€properly€determined€that€the€UniformÏAct€applies€in€this€case.€€€Ìà àà àThe€trial€court€determined€that€ð ðthe€transfer€by€general€partner€Smith€ofÏthe€partnership€asset€at€bar€without€the€consent€of€all€of€the€limited€partners€is€nullÏand€void€as€a€matter€of€law€.€.€œ.ðð€This›€issue€was€also€resolved€through€summaryÏjudgment.€€The€trial€court€noted€that€ð ðthe€sale€of€the€partnership€property€by€theÏgeneral€partner€violated€both€T.C.A.€ðð€61„2„109€and€the€fiduciary€duty€of€the€generalÏpartner€.€.€.ðð€œ›€œ›Ìà àà0 àUnder€the€Uniform€Act:ÌÓÓà8 àà0 àA€general€partner€shall€have€all€the€rights€and€powers€and€beÏsubject€to€all€the€restrictions€and€liabilities€of€a€partner€in€aÏpartnership€without€limited€partners,€except€that€without€theÏwritten€consent€or€ratification€of€the€specific€act€by€all€theÏlimited€partners,€a€general€partner€or€all€of€the€general€partnersÏhave€no€authority:̛̜à8 àà0 à(1)€To€do€any€action€in€contravention€of€the€certificate;Ìà8 àà0 à(2)€To€do€any€act€which€would€make€it€impossible€to€carry€onÏthe€ordinary€business€of€the€partnership;Ìà8 àà0 à(3)€To€confess€a€judgment€against€the€partnership;Ìà8 àà0 à(4)€To€possess€partnership€property,€or€assign€their€rights€in€aÏspecific€partnership€property,€for€other€than€a€partnershipÏpurpose;Ìà0 àà àà8 àà0 à(5)€To€admit€a€person€as€a€general€partner;Ìà0 àà0 à(6)€To€admit€a€person€as€a€limited€partner,€unless€the€right€to€do€so€isÏgiven€in€the€certificate;€orÌà8 àà0 à(7)€To€continue€the€business€with€partnership€property€on€theÏdeath,€retirement,€or€insanity€of€a€general€partner,€unless€the€rightÏto€do€so€is€given€in€the€certificate.ÌÌÓÓT.C.A.€ðð€61„2„109€(repealed€1988).Ìà àà àThe€Limited€Partnership€Agreement€states€that€it€is€intended€to€complyÏwith€the€Uniform€Act€and€that€any€provision€of€the€agreement€that€violates€the€Act€isÏœinvalid.€€Section›€8.3€(l)€of€the€agreement€states:€ÌÓÓà8 àà0 àThe€General€Partner,€on€behalf€of€the€Partnership€and€inÏfurtherance€of€the€business€of€the€Partnership,€shall€have€theÏauthority€to€perform€all€acts€which€the€Partnership€is€authorizedÏto€perform,€including,€but€not€limited€to,€the€following:Ìà8 àà0 à.€.€.€(l)€to€refinance,€sell€or€otherwise€dispose€of€all€or€substantiallyÏall€of€the€assets€of€the€Partnership€at€any€one€time,€subject€to€theÏprovision€of€Article€XI€defining€certain€rights€of€the€LimitedÏPartners.ÌÌÓÓà àà àAs€the€trial€court€noted,€there€is€little€Tennessee€authority€on€this€issueÏunder€the€Uniform€Act.€€The€trial€court€therefore€analyzed€case€law€from€otherÏjurisdictions.€€The€trial€court€relied€heavily€upon€òòNewburger,€Loeb€and€Co.,€Inc.€v.ÏGrossóó,€365€F.Supp.€1364€(S.D.N.Y.€1973),€563€F.2d€1057€(2nd€Cir.,€1977),€òòcert.Ïdenied,€óó434€U.S.€1035€(1978),€611€F.2d€423€(2nd€Cir.€1979).€€In€òòNewburgeróó,€two€ofÏthe€limited€partners€did€not€consent€to€the€transfer€of€partnership€assets€to€a€newÍentity.€€Theòò€Newburgeróó€trial€court,€construing€a€statute€identical€to€the€former€T.C.A.Ïðð€61„2„109€concluded€that€the€general€partners€had€violated€their€statutory€andÏfiduciary€duties.€€The€trial€court€noted:ÌÓÓà8 àà0 àIt€is€undisputed€that€limited€partners€Bleich€and€Donoghue€didÏnot€give€their€written€consent€to€or€thereafter€ratify€the€TransferÏAgreement.€€Plaintiff€contends,€however,€that€execution€of€theÏTransfer€Agreement€was€not€in€violation€of€[the€statute].€€TheÏCourt,€however,€concludes€that€the€execution€of€the€TransferÏAgreement€without€the€written€consent€of€the€limited€partnersÏwas€in€violation€of€the€statute.€Even€if€there€were€a€contraryÏprovision€in€the€Partnership€Articles,€an€issue€which€the€CourtÏneed€not€and€does€not€decide,€such€a€provision€would€violateÏ[the€statute]€and€be€invalid.€ÌÌÓÓ365€F.Supp€at€1365.Ìà à€€€€€€€€€€€The€Second€Circuit€affirmed€the€portion€of€the€opinion€holding€theÏtransfer€invalid,€but€also€cited€to€òòMist€Properties,€Inc.€v.€Fitzsimmons€Realty€Co.óó,€228ÏN.Y.S.2d€406€(N.Y.Sup.Ct.€1962).€€The€Second€Circuit€noted:ÌÓÓòòà8 àòòóóà0 àMist€Propertiesóó€held€that€a€transfer€of€the€partnership€propertyÏby€general€partners,€without€the€consent€of€the€limited€partners,Ïdid€not€violate€[the€N.Y.€Limited€Partnership€Act]€where€theÏpartnership€agreement€ððspecifically€contemplated€and€providedÏforðð€the€transfer€that€took€place.€Id.€at€410.€[The€trial€court]Ïrejected€the€argument€that€the€rights€of€€limited€partners€underÏ[the€statute]€could€be€abrogated€by€the€partnership€agreement€.€.Ï.€However,€there€is€simply€no€language€in€the€PartnershipÏagreement€that€can€be€construed€as€granting€the€generalÏpartners€the€right€to€conduct€[the€transfer].€ÌÌÓÓ563€F.2d€1057,€1075.Ìà àà àThus,€the€Second€Circuit€distinguished€òòNewburger€óófrom€òòMist.óó€€In€òòMist,óóÏthe€limited€partnership€agreement€stated€that:ÌÓÓà0 àà0 àThe€General€Partners€in€their€absolute€discretion€shall€have€the€powerÍon€behalf€of€the€Partnership€(I)€to€sell€and€convey€title€to,€and€to€grantÏan€option€for€the€sale€of€all€or€any€portion€of€the€Property,€includingÏany€mortgage€or€leasehold€interest€or€other€property€which€may€beÏacquired€by€the€Partnership€upon€a€transfer€of€the€Property€.€.€.ÌÌÓÓ228€N.Y.S.2d€at€409.Ìà àà àInterpreting€this€language,€the€court€determined€that€ð ð[t]here€clearlyÏappears€to€have€been€no€violation€of€the€statute€since€the€conveyance€was€notÏwithout€the€written€consent€of€the€limited€partners€but€was€specifically€contemplatedÏand€provided€for€by€the€agreement.ðð€òòId.óó€at€410.€€The€Massachusetts€Appeals€CourtÏconsidered€a€similar€issue€inòò€Wasserman€v.€Wassermanóó,€386€N.E.2d€783Ï(Mass.App.Ct.€1979).€€The€court€noted€that€ð ðcases€from€other€jurisdictions€whichÏhave€considered€the€question€have€either€held€or€assumed€that€the€required€consentÏcan€be€found€in€the€express€provisions€of€a€partnership€agreement.ðð€òòId.óó€at€787Ï(citations€omitted).€€Similarly,€the€Arizona€Court€of€Appeals€held€that€ð ð[t]he€consentÏrequired€by€the€statute€can€be€found€in€the€express€provisions€of€the€partnershipÏagreement.ðð€òòJerman€v.€OððLeary,óó€701€P.2d€1205,€1209€(Ariz.Ct.App.€1985)(citationsÏomitted).Ìà àà àIn€this€case,€the€Limited€Partnership€Agreement€states€that€the€generalÏpartner€has€authority€ð ðto€refinance,€sell€or€otherwise€dispose€of€all€or€substantially€allÏof€the€assets€of€the€Partnership€at€any€one€time€.€.€.ðð€€œUnder›€the€rationale€of€òòMist,óó€thisÏlanguage€could€reasonably€be€interpreted€as€providing€consent€for€the€sale€of€theÏassets.€€Thus,€this€case€is€distinguishable€fromòò€Newburger,€óówhere€no€such€languageÏexisted€in€the€partnership€agreement.€€œAlthough›€the€Appellant€could€properly€sell€theÍassets,€that€does€not€necessarily€€mean€that€he€could€also€purchase€them.€€HisÏpurchase€must€also€be€analyzed€in€terms€of€his€statutory€and€fiduciary€duties.€€Ìà àà àThe€Appellant€was€not€authorized€to€purchase€the€property€at€auction.€ÏUnder€the€Uniform€Act,€a€general€partner€may€not€possess€partnership€property€forÏother€than€a€partnership€purpose€without€the€consent€or€ratification€of€the€limitedÏpartners.€T.C.A.€ðð€61„2„109€(repealed€1988).€€€The€Uniform€Act€requires€ð ðwrittenÏconsent€or€ratification€of€the€specific€act.ðð€òòIdòòóó.óó€€The€Limited€Partnership€Agreement€inÏthis€case€does€not€specifically€permit€the€general€partner€to€possess€partnershipÏproperty€for€a€non„partnership€purpose.€€Although€the€Agreement€grants€very€broadÏpowers€to€the€general€partner,€it€is€to€be€construed€in€accordance€with€the€UniformÏAct.€€Since€there€is€no€specific€grant€of€permission€to€purchase€the€partnershipÏproperty,€the€Appellant€was€not€authorized€to€do€so.€òòCf.óó€òòJerman€v.€OððLearyóó,€701€P.2dÏ1205€(Ariz.Ct.App.€1985)(defendant€did€not€possess€partnership€property€withoutÏconsent€when€partnership€agreement€stated€that€general€partner€could€ð ðacquireððÏpartnership€property).€€€€When€reviewing€documents€that€purportedly€allow€selfÏdealing€by€a€general€partner€ð ðcourts€will€not€imply€such€a€power,€and€even€when€it€isÏexpressly€given€they€construe€it€so€narrowly€that€it€is€seldom,€if€ever,€found€to€exist€inÏthe€matter€under€consideration.ðð€€59A€Am.Jur.2d€òòPartnershipóó€ðð€1291€(1987).€€TheÏAppellant€was€not€authorized€to€purchase€the€property.ÌÓ  Óà àÓ  Óà àà àThe€trial€court€determined€that€the€Appellant€had€no€authority€toÏextend€his€base€management€fee€beyond€its€original€expiration€date.€€The€ContractÏfor€Management€Services,€executed€between€the€limited€partnership€and€the€generalÍpartner€on€December€31,€1982,€provides€in€part:€ÌÓÓà8 àà0 à2€€.òòCompensationóó.€As€full€compensation€for€services€rendered€toÏthe€Partnership€in€whatever€capacity€rendered,€the€PartnershipÏshall€pay€to€Smith€the€sum€of€$545.07€per€month€payable€withinÏten€(10)€days€following€the€conclusion€of€the€month.€TheseÏpayments€shall€be€made€for€five€(5)€years,€and€suchÏcompensation€shall€not€be€paid€for€employment€beyond€thatÏterm.€As€additional€compensation€for€the€services€rendered€toÏthe€Partnership€in€whatever€capacity€rendered,€the€PartnershipÏshall€also€pay€to€Smith,€as€an€incentive€for€the€effectiveÏmanagement€of€the€Partnership,€fifty€per€cent€(50%)€of€all€cashÏincome€realized€in€excess€of€Forty„two€Thousand€DollarsÏ($42,000.00)€per€year€generated€from€the€rental€and€leasing€ofÏthe€Partnership€property.€This€compensation€shall€be€paid€toÏSmith€for€any€employment€during€any€extension€as€provided€inÏparagraph€3€of€this€Agreement.Ìà8 àà0 à3.€€òòTermóó.€The€term€of€employment€shall€be€five€(5)€years€from€theÏdate€hereof€unless€further€extended€by€agreement€of€all€theÏparties€.€.€.ÌÌÓÓà àà àThe€Appellant€continued€to€pay€either€himself€or€his€designee€VirginiaÏAbernathy€(his€wife)€the€$547.07€monthly€fee€after€December€31,€1987.€€TheÏAppellant€memorialized€his€authority€to€extend€the€agreement€in€a€document€datedÏMarch€7,€1990.€€This€document€provides:ÌÓÓà0 àà0 àà àThe€contract€for€management€services€between€BIB€Enterprises,ÏLtd.,€and€Gregory€Smith€expired€December€31,€1987.€This€extensionÏagreement,€per€paragraph€3€of€the€Contract€for€Management€Services,Ïextends€the€Contract€Term€from€the€date€of€expiration,€January€1,€1988Ïthrough€a€period€ending€five€years€from€todayððs€date,€or€until€March€7,Ï1995.ÌÌÓÓœà àà àThis›€document€is€signed€by€Greg€Smith€as€general€partner€of€BIBÏEnterprises,€Ltd.,€and€by€Gregory€Smith€individually.Ìà àà àThe€trial€court€correctly€noted€that€ð ð[t]he€meaning€of€the€contractualÏprovisions€relative€to€compensation€of€the€general€partner€must€be€considered€in€lightÍof€the€fiduciary€duty€of€the€general€partner€and€the€extraordinary€powers€ofÏmanagement€given€to€him,€both€by€the€Uniform€Limited€Partnership€Act€and€by€theÏLimited€Partnership€Agreement€in€œissue.ðð€The›€trial€court€found€that€the€1982ÏContract€for€Management€Services€is€not€ambiguous.€œThe›€interpretation€ofÏunambiguous€contracts€is€a€question€of€law€for€the€court.€òòHardemanòòóó€òòóóCounty€Bank€v.ÏStallingsóó,€917€S.W.2d€695€(Tenn.App.€1995),€òòappeal€deniedóó,€(Jan.€29,€1996).Ìà àà àThe€Contract€for€Management€Services€clearly€states€that€the€$547.07Ïper€month€ð ðshall€be€paid€for€five€(5)€years€and€such€compensation€shall€not€be€paidÏfor€employment€beyond€that€term.ðð€œThe›€contract€also€states€that€the€50%€overrideÏð ðshall€be€paid€to€Smith€for€any€employment€during€any€extension€as€provided€inÏparagraph€3€of€this€œAgreement.ð𛀀Thus,€as€the€trial€court€properly€found,€ð ð[i]t€is€clearÏthat€paragraph€3€can€only€extend€the€percentage€override€term.€Otherwise,€the€five„year€limitation€on€the€Five€Hundred€Forty„five€Dollars€and€Seven€Cents€($545.07)Ïper€month€payment€would€make€no€œsense.ðð›Ìà àà àThe€Appellant€contends€that€the€Limited€Partnership€AgreementÏauthorizes€him€to€make€contracts€on€behalf€of€the€partnership€and€thus€permits€him€toÏextend€the€compensation.€€As€noted€previously,€courts€narrowly€construe€documentsÏthat€purportedly€allow€self€dealing€by€a€general€partner€€59A€Am.Jur.2d€òòPartnershipóóÏðð€1291€(1987).€€The€trial€court€did€not€err€on€this€issue.ÌÓ  Óà àÓ  Óà àà àThe€Appellant€contends€that€the€trial€court€erred€in€holding€thatÏcertain€payments€made€by€Southeast€to€BIB€under€an€equipment€lease„purchaseÏagreement€were€not€rental€or€leasing€income€and€therefore€not€subject€to€theÍprovision€allowing€the€Appellant€50%€of€all€annual€rentals€over€$42,000.00.€ÏAccording€to€the€trial€court€ð ðall€parties€construed€the€equipment€disposition€toÏSoutheast€as€being€the€sale€of€an€asset€rather€than€a€lease€thereof,€and€the€CourtÏagrees€that€such€construction€by€the€parties€is€a€correct€interpretation€of€theÏcontract.ðð€œÌ›à àà àTennessee€decisions€have€addressed€the€distinction€between€a€trueÏlease€and€a€conditional€sale.€€In€òòUnited€States€Fidelity€and€Guar.€Co.€v.€Thompson€&ÏGreen€Mach.€Co.,€Inc.,óó€568€S.W.2d€821,€825€(Tenn.€1978),€the€Tennessee€SupremeÏCourt€stated:ÌÓÓà8 àà0 àPerhaps€the€most€revealing€test€is€whether€the€so„called€lessee€isÏobligated€to€accept€and€pay€for€the€property€or€is€obligated€onlyÏto€return€or€account€for€the€property€according€to€the€terms€ofÏthe€lease€from€which€he€may€be€excused€only€if€he€exercises€hisÏprivilege€of€purchasing€it.€If€the€latter€is€the€case€the€transactionÏis€a€true€lease€but€if€the€contract,€whatever€its€form,€imposes€anÏabsolute€obligation€to€pay€for€and€accept€the€property€and€theÏtransferor€may€require€its€return€only€upon€default€of€theÏtransferee,€the€transaction€is€a€conditional€sale.Ì€Ì(citations€omitted).ÌÌÓÓThe€court€also€noted€that€ð ðthe€intent€of€the€parties€is€always€controlling€and€is€to€beÏascertained€from€the€whole€transaction,€not€merely€from€the€language€employed.ðð€òòId.óó€Ìà àà àIn€this€case,€the€restaurant€equipment€transaction€between€BIB€andÏSoutheast€is€titled€ð ðLease€Agreementðð€and€is€separate€from€the€lease€of€theÏrestaurant€œitself.›€The€original€transaction€between€BIB€and€Dinero€made€no€suchÏdistinction.€€The€terms€of€the€Southeast€transaction€state€that€it€is€a€thirty€month,€non„cancelable€lease€requiring€payments€of€$1698.30€per€month€plus€sales€tax.€€It€appearsÍthat€the€only€way€BIB€could€repossess€the€equipment€during€this€period€was€ifÏSoutheast€defaulted.€€Paragraph€four€of€the€agreement€provides€ð ð[a]t€the€expirationÏof€the€lease€term,€the€Lessee€shall€have€the€option€of€purchasing€the€said€equipmentÏby€paying€the€sum€of€Twelve€Thousand€Five€Hundred€Dollars€($12,500.00)€to€theÏLessor.€€Until€such€price€shall€have€been€paid€in€full,€the€said€equipment€shall€remainÏin€the€property€of€the€œLessor.ðð›Ìà àà àIn€òòUnited€States€Fidelity,óó€the€court€noted:ÌÓÓà8 àà0 àIn€close€cases€the€courts€consider€whether€the€paymentsÏrequired€of€the€transferee€are€in€such€amounts,€spread€over€suchÏa€period€of€time,€and€are€to€be€so€made€that€compared€with€theÏoriginal€value€of€the€property,€its€depreciation€and€likely€value€atÏthe€end€of€the€term,€that€they€may€be€reasonably€considered€asÏcompensation€òòfor€the€useóó€of€the€property€or,€instead,€asÏpayments€on€an€absolute€obligation€òòfor€the€purchase€priceóó,€as€inÏa€conditional€sale.ÌÌÓÓ€568€S.W.2d€at€825.€Ì€Southeastððs€total€€payments,€including€sales€tax,€over€thirty€months€amounted€toÏapproximately€$54,705.30.€€Southeast€could€then€exercise€its€option€to€purchase€theÏequipment€for€$12,€500.00.€€This€low€purchase€price,€compared€to€the€amount€of€theÏmonthly€payments€indicates€that€Southeast€was€making€payments€towards€aÏpurchase.€€€à àà àThe€trial€court€applied€the€rule€of€practical€construction.€€UnderÏthis€approach,€ð ðthe€interpretation€placed€upon€a€contract€by€the€parties€thereto,€asÏshown€by€their€acts,€will€be€adopted€by€the€court€.€.€.ðð€òòHamblen€County€v.€City€ofÏMorristown,óó€656€S.W.2d€331,€335€(Tenn.€1983)(citations€omitted).€€When€applyingÏthis€rule,€ð ðnot€only€the€acts€but€the€declarations€of€the€parties€may€be€considered.ððÍòòId.óó€€Additionally:ÌÓÓà8 àà0 àIn€applying€the€appropriate€standard€of€interpretation€even€to€anÏagreement€that€on€its€face€is€free€from€ambiguity€it€is€permissibleÏto€consider€the€situation€of€the€parties€and€the€accompanyingÏœcircumstances›€at€the€time€it€was€entered€into€ð"ð€not€for€theÏpurpose€of€modifying€or€enlarging€or€curtailing€its€terms,€but€toÏaid€in€determining€the€meaning€to€be€given€to€the€agreement.Ìòò€óóòòà0 àà0 àòòóóAppling€v.€Ellendale€122€Propertyóó,€718€S.W.2d€261€(Tenn.App.Ï1986)(applying€rules€of€€construction€to€a€limited€partnershipÏagreement).€€ÌÌÓÓà àà àIn€this€case,€the€record€contains€no€direct€evidence€of€how€SoutheastÏviewed€the€transaction.€€The€trial€court€was€correct,€however€in€finding€that€the€BIBÏpartners€viewed€the€transaction€as€a€sale.€€In€a€memorandum€written€in€preparationÏfor€litigation€against€Martin„Dinero€for€defaulting€on€the€original€lease€and€datedÏDecember€11,€1985,€one€of€the€BIB€limited€partners€described€the€deal€withÏSoutheast:ÌÓÓà àà8 àAs€I€recall,€for€tax€purposes€we€valued€the€equipment€atÏ$125,000€at€the€time€of€the€original€lease€on€December€31,Ï1982.Ì€€€à àà8 àThe€lease€was€breached€and€we€threw€Dinero€off€theÏproperty€on€December€31,€1984.€€We€were€forced€to€get€aÏnew€tenant€and€the€new€tenant€is€Southeast€RestaurantsÏwhich€is€really€a€man€named€McKinney.€McKinneyÏwould€not€lease€the€property€from€us€unless€he€wasÏpermitted€to€buy€the€equipment€from€us.€We€were€forcedÏin€order€to€quickly€re„lease€the€property€to€sell€him€theÏequipment€as€of€January€1,€1985€for€$60,000€payable€atÏthe€rate€of€$1,698.30€a€month€with€an€option€to€purchaseÏat€the€end€of€the€30„month€period€of€$12,500.€I€believeÏwe€calculated€this€as€a€total€of€$60,000€payable€over€theÏ30„month€period€with€an€extremely€low€interest€rate„„something€like€5%.ÌÌÓÓà àà àSimilarly,€the€Appellant€testified€by€deposition€in€the€same€litigation.€ÍWhen€asked€about€the€equipment€transaction€he€stated€that€Southeast€wasÏð ðpurchasing€the€equipment€under€a€lease€purchase€agreement€.€.€œ.ð𛀀Additionally,€in€aÏreport€to€the€limited€partners€dated€January€9,€1985,€the€Appellant€noted€that€theÏDinero€lease€ð ðhad€no€separate€provision€for€equipment,€while€the€new€agreementÏtreats€the€equipment€œseparately.ð𛀀He€noted€that€under€the€new€lease€ð ðtheÏequipment€is€being€sold,€resulting€in€present€cash€flow€for€the€œpartnership.ðð›Ìà àà àThe€Appellantððs€expert€witness€characterized€the€equipmentÏtransaction€as€a€lease€ð ð[a]t€least€for€tax€and€financial€reporting€œpurposes.ðð›€The€trialÏcourt€found€that€ð ð[t]he€critical€question€to€be€answered€is€not€under€tax€andÏaccounting€law,€but€under€principles€of€contract€construction€applicable€to€theÏlimited€partnership€agreement€in€question.ðð€œIn›€òòUnited€States€Fidelityóó,€the€courtÏstated€that€ð ð[t]he€accounting€methods€employed€by€each€of€the€parties€with€respectÏto€the€rental€payments€.€.€.€may€be€considered€to€be€more€indicative€of€the€hope€of€theÏparties€to€minimize€federal€income€taxes€than€of€the€true€nature€of€the€transactionsÏbetween€them.ðð€568€S.W.2d€at€826.€€Based€on€all€the€available€evidence,€the€trialÏcourt€did€not€err€in€characterizing€the€Southeast€equipment€transaction€as€a€sale€notÏsubject€to€the€50%€override.ÌÓ  Óà àÓ  Óà àà àThe€Appellant€argues€that€the€trial€court€erred€in€determiningÏthat€payments€made€to€BIB€by€the€guarantors€of€the€original€Dinero€lease€were€notÏsubject€to€the€50%€override€provision.€€The€trial€court€held€that€the€payments€wereÏnot€ð ðrent€or€leaseðð€payments€and€were€therefore€ð ðsimply€not€subject€to€the€50%Ïœoverride.ð𛀀The€trial€court€noted€that€ð ðsuch€payments€were€not€considered€by€theÍmanaging€partner€himself€to€be€subject€to€the€override€until€after€ill€will€developedÏamong€the€parties.ðð€Ìà àà àThe€entire€$25,000.00€settlement€was€distributed€in€accordance€withÏparagraph€7.2€of€the€Partnership€Agreement,€which€addresses€cash€distributions€toÏthe€limited€partners.€€€The€trial€court€found€that€the€Appellant€never€asserted€anyÏright€to€the€50%€override€at€that€time.€€While€some€percentage€of€the€total€settlementÏcould€arguably€comprise€compensation€for€lost€rent,€the€evidence€does€not€show€thatÏit€was€treated€that€way€by€the€parties.€€Thus,€the€trial€court€did€not€err€on€this€issue.ÌÓ  Óà àÓ  Óà àà àThe€trial€court€also€determined€that€an€F.D.I.C.€discount€of€theÏmortgage€on€the€property€was€not€income€from€leasing€and€rental.€€After€the€Bank€ofÏLoretto€failed,€the€F.D.I.C.€took€it€over€and€thus€obtained€the€Dinero€loan€on€whichÏBIB€was€making€monthly€payments.€€The€Appellant€negotiated€with€the€F.D.I.C.€andÏwas€able€to€obtain€a€$45,000.00€discount€on€the€note,€which€BIB€purchased€forÏ$235,000.00.€€BIB€obtained€financing€for€the€purchase€through€a€bridge€loan€atÏDominion€Bank.Ìà àà àThe€Appellant€contends€that€the€$45,000.00€discount€was€subject€toÏthe€50%€override€provision.€€The€trial€court€held€that€the€discount€ð ðproduces€aÏreduction€in€debt€for€the€partnership€and€is€not€ððlease€or€rentalðð€income€.€.€œ.ðð›€The€trialÏcourt€was€correct€in€this€determination.€€The€Partnership€Agreement€provides€for€theÏ50%€override€for€cash€income€ð ðgenerated€from€the€rental€and€leasing€of€theÏPartnership€œproperty.ðð›€The€F.D.I.C.€discount€does€not€fall€under€the€terms€of€thisÏprovision€and€is€therefore€not€subject€to€the€50%€override.€€€€Ìà àà àThe€Appellant€argues€that€the€trial€court€erred€in€refusing€to€reduce€hisÏdebt€to€the€partnership€by€$27,054.65.€€This€amount€represents€payments€theÏAppellant€made€when€he€purchased€the€partnership€property.€€The€Appellant€made€aÏ$24,250.00€down€payment€and€paid€$2,804.50€in€closing€costs.€The€trial€courtÏdetermined€that€he€was€not€entitled€to€the€offset€since€ð ðthe€purported€sale€of€theÏonly€asset€of€the€limited€partnership€was€null€and€void€and€in€breach€of€his€fiduciaryÏduty.ðð€œAs›€noted€previously,€the€Appellant€was€authorized€to€sell€the€partnershipÏproperty.€€He€could€not,€however,€purchase€it€for€himself.Ìà àà àThe€trial€court€properly€voided€the€Appellantððs€purchase€of€theÏproperty.€€The€Appellant€should€œreceive›€a€credit,€however,€for€the€money€that€BIBÏreceived€after€the€sale.€€Otherwise,€the€Appellees€would€receive€a€windfall€becauseÏthey€would€not€only€have€the€property,€but€would€also€retain€the€money€paid€by€theÏAppellant.€€Exhibit€202€6„17„97,€affixed€to€Vol.€18€of€the€Transcript,€is€an€analysis€ofÏthe€offset.€€This€analysis€computes€the€total€cash€the€Appellant€paid€and€then€deductsÏany€settlement€charges€paid€by€either€the€buyer€or€seller€as€a€result€of€the€sale.€€ThisÏcomputation€yields€an€offset€of€$27,054.65,€which€would€reduce€the€AppellantððsÏdebt€to€the€partnership€to€$26,462.12.€€The€trial€court€œerred›€in€failing€to€make€thisÏoffset.Ìà àà àThe€Appellant€contends€that€the€trial€court€erred€in€ordering€theÏdissolution€of€the€partnership€and€appointing€a€receiver.€€The€Appellant€argues€thatÏthe€Appellees€waived€the€right€to€seek€such€relief€in€the€Partnership€Agreement.€€AÏcourt€has€no€authority€to€order€dissolution€absent€an€application€by€one€of€theÍparties.€òòOwens€v.€Bricks,€Inc.óó,€703€S.W.2d€147€(Tenn.App.€1985).€€In€this€case,€theÏrequest€was€set€forth€in€the€Amended€Complaint.€€ð ðThe€terms€of€a€partnershipÏcontract€will€not€deprive€a€court€of€its€equity€jurisdiction€to€decree€the€dissolution€ofÏa€partnership€on€proper€grounds.ððòò€óó59A€Am.Jur.2d€òòPartnershipóó€ðð849€(1987);€òòSeeÏalso€Barclay€v.€Barrie,óó€102€N.E.€602€(N.Y.€1913)(partnership€agreement€stating€thatÏthere€was€no€right€to€relief€until€a€set€period€of€time€after€notice€of€breach€did€notÏdefeat€right€to€seek€judicial€dissolution).€€The€trial€court€properly€ordered€dissolution.Ìà àà àThe€Appellees€argue€that€the€trial€court€erred€in€refusing€to€find€theÏAppellantððs€wife,€Virginia€Abernathy,€liable€for€conversion.€€Conversion€is€ð ðtheÏappropriation€of€[property]€to€the€partyððs€own€use€and€benefit,€by€the€exercise€ofÏdominion€over€it,€in€defiance€of€plaintiffððs€right.ððòò€Mammoth€Cave€Prod.€CreditÏAssððn.€v.€Oldham,óó€569€S.W.2d€833,€836€(Tenn.App.€1977)€(citations€omitted).€€TheÏAppellees€claim€that€Virginia€Abernathy€received€funds€through€an€agreement€withÏthe€Appellant€to€receive€part€of€his€management€fee.€€The€trial€court€found€that€theÏAppellees€were€not€entitled€to€a€judgment€against€Virginia€Abernathy€and€that€theÏamount€of€money€sought€from€her€was€included€within€the€amount€already€adjudgedÏagainst€the€œAppellant.€€The›€trial€court€determined€that€the€proof€did€not€establish€anyÏbasis€for€holding€Abernathy€liable.€œ€Based›€on€the€record,€the€trial€court€did€not€err€onÏthis€issue.€ÌÓ  Óà àÓ  Óà àà àThe€Appellees€also€argue€that€the€trial€court€erred€in€refusing€toÏaward€them€attorneyððs€fees,€discretionary€costs€and€prejudgment€interest.€€Generally,Ïattorneyððs€fees€are€not€recoverable€ð ðin€the€absence€of€a€statute€or€contractÍspecifically€providing€for€such€recovery,€or€a€recognized€ground€of€equity€.€.€.ððÏòòPullman€Standard,€Inc.€v.€Abex€Corp.óó,€693€S.W.2d€336,€338€(Tenn.€1985).€€€TheÏRevised€Uniform€Limited€Partnership€Act€provides€for€recovery€of€attorneyððs€fees€inÏderivative€actions.òò€Seeóó€T.C.A.€ðð€61„2„1004.€€There€is€no€provision€under€the€UniformÏLimited€Partnership€Act€that€seems€applicable€to€this€case.€€Tennessee€cases€haveÏallowed€attorneyððs€fee€awards€for€breaches€of€a€trusteeððs€fiduciary€duty.€òòBrown€v.ÏConroy,óó€1990€WL€10574€(Tenn.App.);€òòSee€also€Marshall€v.€First€Nat.€Bank€ofÏLewisburgóó,€622€S.W.2d€558€(Tenn.App.€1981)(recognizing€appropriateness€of€suchÏan€award).€€Regardless,€the€trial€court€properly€noted€that€under€the€facts€of€thisÏparticular€case€attorneyððs€fees€should€not€be€awarded.€€The€trial€court€did€not€err€onÏthis€issue.Ìà àà àAn€award€of€prejudgment€interest€is€within€the€sound€discretion€of€theÏtrial€court€and€will€not€be€disturbed€on€appeal€absent€an€abuse€of€that€discretion.€òòOtisÏv.€Cambridge€Mut.€Fire€Ins.€Co.óó,€850€S.W.2d€439€(Tenn.€1992).€€In€òòMitchell€v.ÏMitchellóó,€876€S.W.2d€830,€832,€(Tenn.€1994)€the€Supreme€Court€noted€thatÏprejudgment€interest€would€be€allowed€when€ð ðthe€amount€of€the€obligation€isÏcertain,€or€can€be€ascertained€by€a€proper€accounting,€and€the€obligation€is€notÏdisputed€on€reasonable€grounds.€.€.ðð€€€In€this€case,€there€was€considerableÏcontroversy€over€the€amount€due.€€The€trial€court€did€not€abuse€its€discretion.€€TheÏsame€standard€of€review€governs€the€awarding€of€discretionary€costs.€Tenn.R.Civ.P.Ï54.04(2).€€Based€on€the€record,€the€trial€court€also€did€not€abuse€its€discretion€on€thisÏissue.Ìà àà àWe€affirm€the€judgment€of€the€Trial€œCourt,€as€modified€herein.€€TheÏcause€is€remanded€for€entry€of€judgment€in€conformity€with€this€Opinion.€€The€cost€ofÏthe€cause€is€adjudged€one„half€to€the€appellants€and€one„half€to€the€appellees.€€›ÌÓÓÌÌÌà@ àòòà àÌóóà àà àà àà àà àà à__________________________Ìà àà àà àà àà àà àHerschel€P.€Franks,€J.ÌÌÌCONCUR:ÌÌÌÌÌÌ___________________________ÌHouston€M.€Goddard,€P.J.ÌÌÌÌÌÌ___________________________ÌDon€T.€McMurray,€J.Ì