Gibson v. Gibson Family Limited Partnership

877 N.W.2d 597 (2016)

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Nature of the Case

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Facts

In 2002, Delores Gibson and her two sons, P and Greg Gibson, created the Gibson Family Limited Partnership (D) as an estate-planning tool. P and Greg each own a 45.8% interest, and Delores owns the remaining 8.4% interest. Delores serves as the general partner, and P and Greg are limited partners. As the sole general partner, Delores is responsible for management of the partnership. Delores has sole authority to decide with whom the partnership conducts business and whether to distribute income. As limited partners, P and Greg have no significant duties. D includes 2,060 acres of land P and Greg jointly farmed and ranched the land until 2006. In 2006, the brothers split, and each started his own cattle and farming operation. In a 2006 suit P sued for breach of fiduciary duties when Delores loaned money to Greg and also leased land to Greg. The jury ruled in D’s favor. In December 2010, D renewed the lease with Greg for a twenty-year term and sold 830 acres of the leased property to Greg for $1,100,000. P again sued for breach of fiduciary duty and this time contending that he was 'frozen out' out of the partnership and that he was incurring tax liabilities without receiving partnership distributions to pay them. The court granted P's motion to amend his complaint to also seek equitable relief in the form of dissociation from D for value. The jury found for D on the fiduciary duty claim. The court denied P's dissociation claim. P appealed.