## Facts

- Theodore Richert and C.C. Handly entered an oral agreement to purchase and log a tract of timber and to share the venture’s profits equally.
- Richert supplied the money needed for the timber purchase and related expenses, contributing about $26,842 (often summarized as roughly $27,000).
- Handly performed the logging using his own equipment; the venture paid him $8,673.84 for the use of that equipment.
- The parties did not make a clear agreement on how partnership losses would be shared or whether Richert’s capital contribution would be repaid from venture proceeds before losses were allocated.
- Richert sued to dissolve the logging partnership and for an accounting.
- At dissolution, the venture had about $15,000 in net receipts, resulting in an overall loss of roughly $12,000 when compared to Richert’s capital outlay.
- The trial court initially entered judgment for the defendants and dismissed Richert’s complaint; the Washington Supreme Court previously held (in an earlier appeal) that the findings were inadequate to support any judgment and remanded for additional findings.
- On remand, the parties introduced no new evidence; the trial court entered supplemental findings but again reached a result adverse to Richert, leading to this second appeal.

## Issues

1. Whether the trial court’s supplemental findings after remand were sufficiently complete and consistent to support a judgment in a dissolution-and-accounting action arising from an oral logging partnership.
2. Whether the accounting could properly proceed without a clear finding on the agreed basis for sharing losses (equal, proportionate to contributions, or otherwise) and on any priority of claims between the participants.
3. Whether a finding that Handly was not personally liable to repay Richert’s investment necessarily meant Richert could not be reimbursed from the venture’s remaining proceeds.

## Decision

- The Washington Supreme Court held that the supplemental findings still did not comply with the court’s prior mandate because they failed to state a coherent basis for allocating losses and distributing receipts.
- The court noted that calling the relationship a “partnership” or a “joint venture” does not decide the parties’ rights; the accounting must be based on what the parties agreed to and what the record establishes about contributions and distributions.
- The court determined that the findings remained internally inconsistent and incomplete, including confusion over whether losses were to be shared equally and whether Richert had any right to reimbursement from venture proceeds.
- The court reiterated that the fact that Handly was not to be personally liable to Richert for losses did not, by itself, resolve whether Richert was to be reimbursed out of the proceeds of the venture.
- The judgment for respondents was reversed, and the case was remanded with directions to make detailed findings and restate the account, including findings on: (a) the agreed basis for sharing losses; (b) whether either party’s claims had priority; (c) each party’s contributions (capital, equipment rental, and any agreed compensation); (d) total receipts and authorized disbursements; (e) amounts already received by each party; and (f) the amount due each under the agreement as found.

## Legal Principles

- Whether an undertaking is described as a partnership or joint venture is not determinative; the parties’ rights and duties depend on the terms of their agreement and the accounting required by that agreement.
- In an action for dissolution and accounting, findings must be specific enough to permit a complete restatement of the account, including contributions, receipts, disbursements, distributions to date, and the method of allocating profits and losses.
- Findings that are inconsistent or silent on the loss-sharing basis and priority of claims cannot support the judgment entered (or any workable accounting judgment).
- An agreement that one participant is not personally liable to reimburse the other does not automatically decide whether the contributing party is to be repaid from the venture’s assets or proceeds.

## Conclusion

Because the trial court’s post-remand findings still did not clearly and consistently determine how losses were to be shared and how remaining receipts were to be distributed (including any reimbursement priority for Richert’s capital), the Washington Supreme Court reversed and remanded for detailed findings and a restated accounting consistent with the parties’ agreement as found.


Richert v. Handly, 53 Wash.2d 121, 330 P.2d 1079 (1958)