## Facts

- Anna Reid and three partners formed a written partnership (Sept. 28, 1958) to lease for profit certain Montgomery County, Pennsylvania real estate.
- Reid contributed real estate valued at $50,000 and $10,000 cash; the other partners contributed $10,000 cash in equal shares.
- The agreement assigned Reid managerial duties and assigned the other partners physical maintenance responsibilities.
- On Feb. 10, 1971, Reid sent a letter stating she was dissolving the partnership and requesting prompt liquidation of partnership assets.
- The parties met after the letter but did not reach agreement on a liquidation plan or on their respective rights in the assets.
- Reid filed an equity action seeking winding up and distribution; she later died, and her estate’s co-executors (including Girard Bank) were substituted as plaintiffs.
- The partnership agreement included a provision allowing surviving partners, upon a partner’s death, to purchase the deceased partner’s interest.

## Issues

1. Whether the partnership was dissolved during Reid’s lifetime by her Feb. 10, 1971 letter, or instead was dissolved upon her death.
2. If dissolution occurred during Reid’s lifetime, whether the surviving partners’ contractual option to purchase a deceased partner’s interest applied.

## Decision

- The Supreme Court of Pennsylvania reversed the final decree.
- It held the partnership was dissolved during Reid’s lifetime by her clear and unequivocal letter of Feb. 10, 1971.
- Because dissolution preceded Reid’s death, the agreement’s surviving-partner purchase option did not govern.
- The case was remanded for accounting and distribution consistent with dissolution and winding up under the Uniform Partnership Act as of Feb. 10, 1971.

## Legal Principles

- In an at-will partnership, dissolution occurs upon a partner’s express will communicated clearly to the other partners, absent an agreement for a definite term or particular undertaking.
- The legal consequences of dissolution depend on timing; rights during winding up are determined as of the dissolution date.
- A contractual buyout option triggered by a partner’s death applies only if the partnership remains undissolved at the time of death; death during winding up does not activate such a clause where dissolution already occurred.
- After dissolution, the Uniform Partnership Act governs winding up, including accounting and distribution of assets and profits.

## Conclusion

The court ruled that Reid’s unequivocal written notice dissolved the at-will partnership before her death, making the surviving-partner death buyout clause inapplicable and requiring liquidation and distribution under statutory dissolution and winding-up rules based on the earlier dissolution date.


Girard Bank v. Haley, 332 A.2d 443 (Pa. 1975)