## Facts

- Marton & Associates was a real-estate partnership formed in 1960 to buy, sell, and exchange real property; for many years its sole asset was a 238-acre parcel near Buckeye, Arizona.
- The partnership agreement stated that the death of a partner would not dissolve the partnership and authorized the partnership’s business to be conducted by majority consent of the partners.
- Over time, some original partners died, and their partnership interests passed to heirs, trusts, or spouses as successors in interest.
- In November 1985, John Vinson entered into a written purchase agreement to buy the partnership’s land; the agreement was signed on behalf of the partnership by Larry Melcher and John Silva.
- At the time of the transaction, Melcher held powers of attorney from some partners.
- On December 2, 1985, escrow instructions were signed by a majority of the partners.
- The partnership later refused to convey the property to Vinson.
- Vinson sued the partnership and individual partners/successors for breach of contract and sought specific performance (and alternatively damages).
- The trial court granted summary judgment for the defendants on the contract claim, reasoning that UPA § 9 required unanimous partner consent for an act making it impossible to carry on the partnership’s ordinary business and that sale of the partnership’s sole asset required unanimity; it also reasoned the agreement’s majority-consent clause could not bind successor partners.
- After later events (including payment of the judgment and disposition of the property), the defendants argued Vinson’s appeal was moot.

## Issues

1. Did the partnership agreement’s continuation-on-death and majority-consent provisions control over UPA default rules, so that a sale of the partnership’s sole asset did not automatically require unanimous consent?
2. Could Melcher and Silva bind the partnership to the land-sale contract based on actual authority (including powers of attorney), apparent authority, and/or majority partner consent reflected in the escrow instructions?
3. Was the appeal moot because the judgment had been paid and the property was later conveyed in a different transaction?
4. Could Vinson be required, before trial, to elect between specific performance and damages?

## Decision

- The appeal was not moot; payment of a judgment does not automatically eliminate a live controversy where the payment is not voluntary and appellate relief could still affect the parties’ rights.
- The partnership agreement controlled over inconsistent UPA default rules; the agreement was not “silent” on continuation after death or on how the partnership could act, and successors took their interests subject to the agreement’s terms.
- Summary judgment for the defendants on the theory that unanimous consent was required under UPA § 9 was improper; the record allowed a factfinder to conclude the partnership could act by majority consent and that the transaction could be authorized under the agreement.
- Genuine issues of material fact remained concerning authority and consent (including whether Melcher and Silva had authority to execute the purchase agreement and whether the majority-signed escrow instructions reflected valid partnership approval), requiring further proceedings.
- Vinson could not be forced to elect between specific performance and damages before the conclusion of trial; he was permitted to pursue alternative remedies until the facts were determined.

## Legal Principles

- The Uniform Partnership Act generally supplies default rules that yield to a valid partnership agreement allocating governance and decision-making authority.
- A partnership agreement may provide that a partner’s death does not dissolve the partnership; successor holders of partnership interests take subject to the agreement’s governance provisions.
- Where a partnership agreement authorizes majority action, a sale of partnership property—including the partnership’s only asset—may be approved through the mechanism the partners chose, rather than by UPA unanimity rules applied as if the agreement were silent.
- Authority to bind a partnership may be shown through actual authority (including powers of attorney), apparent authority, and the partners’ conduct; when competing inferences are possible, authority and consent are commonly fact questions not suitable for summary judgment.
- A plaintiff generally cannot be compelled to elect between inconsistent or alternative remedies (such as specific performance and damages) before trial concludes.
- An appeal is not automatically moot merely because a judgment has been paid; payment made under compulsion does not necessarily waive appellate review, and a case remains justiciable if appellate action can still affect the parties’ rights.

## Conclusion

The Arizona Court of Appeals reversed the summary judgment for Marton & Associates and remanded, holding that the partnership agreement’s continuation and majority-consent provisions could displace UPA default unanimity rules and that disputed facts remained as to the authority and approval for the land-sale contract; the court also held the appeal was not moot despite payment of the judgment and that Vinson could pursue specific performance and damages as alternative remedies through trial.


Vinson v. Marton & Associates, 764 P.2d 736, 159 Ariz. 1 (1988)