## Facts

- Jacobs Cattle Company (JCC) was a Nebraska family partnership that owned farmland and rented it to others.
- JCC’s partners included Ardith Jacobs (the managing partner under the partnership agreement), Ardith’s children (including Dennis Jacobs and Patricia Robertson), and Patricia’s husband, James Robertson.
- The partnership agreement gave Ardith broad authority to run JCC’s day-to-day business.
- Patricia and James Robertson rented farmland from JCC.
- At Ardith’s direction, JCC sued Patricia and James for unpaid rent and obtained a judgment.
- After the rent litigation, relations among the partners deteriorated, and the partners agreed JCC could not continue to function with Patricia and James as partners.
- Patricia and James filed an action seeking dissolution of the partnership.
- JCC, Ardith, and Dennis asked the court to order dissociation (judicial expulsion) of Patricia and James instead of dissolving the partnership, and they argued the buyout should be valued from May 2005 (when the nonpayment occurred).
- The district court refused to dissolve the partnership and, in September 2011, ordered Patricia and James dissociated and directed a buyout of their partnership interests.
- The district court set September 2011 (the date of dissociation) as the valuation date for the buyout.
- Patricia and James appealed, challenging the refusal to dissolve and the buyout procedure; JCC, Ardith, and Dennis cross-appealed on the valuation date and challenged aspects of the interest determination.

## Issues

1. Did the district court err by refusing to dissolve and liquidate the partnership and instead ordering judicial dissociation of the Robertsons and a buyout of their interests?
2. Did the district court err in determining the buyout price by preventing the Robertsons from presenting evidence on the proper calculation and valuation?
3. Did the district court select the correct valuation date for the buyout (September 2011 rather than May 2005)?
4. Did the district court correctly determine interest owed on the buyout obligation?

## Decision

- The Nebraska Supreme Court treated the dissolution/accounting dispute as an equity action and reviewed the record de novo, giving weight to the trial court’s credibility determinations when evidence conflicted.
- The Court affirmed the district court’s refusal to dissolve the partnership and affirmed the order judicially dissociating (expelling) Patricia and James Robertson rather than liquidating JCC.
- The Court held the district court erred by not allowing the Robertsons to introduce evidence on the proper calculation of the buyout price, and it reversed and remanded for further proceedings to determine the buyout amount.
- On cross-appeal, the Court approved using the dissociation date (September 2011) as the valuation date, rejecting the proposed May 2005 valuation date.
- The Court also held the district court erred in its determination regarding interest and remanded for recalculation consistent with the governing statute.
- Disposition: affirmed in part as modified and in part reversed and remanded with directions.

## Legal Principles

- An action for partnership dissolution and accounting between partners is equitable and is reviewed de novo on the record, with some deference to credibility findings made by the trial court.
- Statutory interpretation and interpretation of a partnership agreement present questions of law.
- Under Nebraska’s revised partnership statute, judicial dissociation (expulsion) with a buyout can be an available remedy and may be ordered instead of dissolution when the partnership can continue as a going concern and expulsion addresses the conflict.
- A dissociated partner’s buyout is measured as of the date of dissociation, not an earlier date tied to the dispute that led to litigation.
- In a buyout proceeding, the court must provide a fair opportunity for the parties to present competent evidence on valuation and the proper method for computing the buyout price; cutting off that evidence is reversible error.
- Interest on the buyout obligation must be determined using the statutory framework; an incorrect interest determination requires correction on remand.

## Conclusion

Robertson v. Jacobs Cattle Co. approved continuation of a family farming partnership through judicial dissociation and a statutory buyout rather than dissolution, but it sent the case back because the trial court limited valuation evidence and mishandled the interest determination, while confirming that valuation must be measured as of the dissociation date.


Robertson v. Jacobs Cattle Co., 285 Neb. 859 (2013)