Indications of Partnership: Norris v. Fontenot

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Fundamentals of Business Law. Summarized Cases. 8th Edition
24.4 Indications of Partnership – Norris v. Fontenot.
In 1996, Stafford Fontenot, Steve Turner, Mike Montelaro, Joe Sokol, and Doug Brinsmade decided to go to Atlanta, Georgia, the site of the Olympic Games to sell Cajun food. They started the preparations about 6 month before, choosing “Prairie Cajun Seafood Catering of Louisiana” as their name. On May 19, they applied for a license with the designated department in Fulton County, Georgia. Later on, Mr Fontenot and his friends, agreed to buy a mobile kitchen to Ted Norris for the amount of $50,000. After negotiations, they paid $8,000 down payment with a check, using the “Prairie Cajun Seafood Catering of Louisiana’s” checking account and the balance was divided in two promissory notes ($12,000 and $20,000). Stafford Fontenot was the only name listed on the notes, but once Mr Norris’s lawyer agreed to add “doing business as Prairie Cajun Seafood” after Fontenot’s name, he signed the promissory notes dated June 12, 1996. Over a month later, on July 31, the group signed an article of partnership containing specific divisions of profits and losses. Ready to enter into the market, they went to Atlanta, but business did not go well and they couldn’t pay the promissory notes. Consequently, Mr Norris filed a suit against Mr Fontenot to recover the amounts due on the notes. The defendant affirmed they didn’t pay for the notes but that he was only liable for his part of the debt, because he signed the notes on behalf of the partnership. Ted Norris, on the other hand, testified that he did business with Stafford Fontenot and he assumed that the rest of the group was associated with Stafford who, according to Mr Norris believed, owned the company. In this case, is important to focus in whether there was a partnership among Fontenot and the others, by the time they purchased the mobile kitchen or not. In resolving this issue, and having in mind that Louisiana is...
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