Shine & Co. LLP v Natoli

Shine & Co. LLP v Natoli 2011 NY Slip Op 08192 Decided on November 15, 2011 Appellate Division, First Department Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and subject to revision before publication in the Official Reports.

Decided on November 15, 2011
Friedman, J.P., Catterson, Moskowitz, Freedman, Abdus-Salaam, JJ.
5891 600551/10

[*1]Shine & Company LLP, Plaintiff-Respondent,

v

Angelo F. Natoli, Defendant-Appellant.




McLaughlin & Stern, LLP, New York (Jon Paul Robbins of
counsel), for appellant.
Robinson Brog Leinwand Greene Genovese & Gluck P.C.,
New York (Ronald S. Herzog of counsel), for respondent.

Order and judgment (one paper), Supreme Court, New York County (Carol R. Edmead, J.), entered July 19, 2010, which, among other things, granted plaintiff's motion for summary judgment on its first cause of action seeking a declaration that defendant is not entitled to share in any proceeds from the sale of all or part of plaintiff accounting practice to a third party, and so declared, unanimously affirmed, without costs.

Defendant failed to raise an issue of fact as to whether he is an equity partner in plaintiff (see M.I.F. Sec. Co. v Stamm & Co., 94 AD2d 211, 214 [1983], affd in part 60 NY2d 936 [1983]). The motion court properly found that the letter of intent (LOI) controlling the terms of the parties' relationship was unambiguous. Thus, the court properly declined to consider extrinsic evidence to interpret its terms (see Bailey v Fish & Neave, 8 NY3d 523, 528 [2007]). Initially, we note that the LOI's express reference to defendant as an "equity partner" is not determinative (see Kyle v Ford, 184 AD2d 1036, 1037 [1992]). The LOI clearly did not provide for defendant to share in plaintiff's profits or losses. Both are essential elements of a partnership agreement, and defendant failed to present any evidence to support his assertion that he would have shared in either profits or losses (see Matter of Steinbeck v Gerosa, 4 NY2d 302, 317 [1958], lv dismissed 358 US 39 [1958]; Chanler v Roberts, 200 AD2d 489, 491 [1994], lv dismissed in part, lv denied in part 84 NY2d 903 [1994]). Moreover, the LOI expressly provided for defendant to receive a Form 1099 rather than a Schedule K-1. As an accountant, defendant [*2]understood the difference between these two tax forms. Thus, he knew that his receipt of a 1099 meant that his compensation was not from profits and that he would not share in losses.

THIS CONSTITUTES THE DECISION AND ORDER
OF THE SUPREME COURT, APPELLATE DIVISION, FIRST DEPARTMENT.

ENTERED: NOVEMBER 15, 2011

CLERK