A partnership was formed between plaintiff and defendant with plaintiff purchasing a 10% interest in L’Epicerie for $100,000. Payment for the stock purchase was made in May 2008. In July 2008, dispute arose between the parties and the $100,000 was instead turned into a loan which defendant, in March 2009, advised that he would be unable to pay when due. Action was started in August 2010 with plaintiff seeking $116,618 in damages for defendant’s failure to repay the loan.
The Court determines that, despite defendant’s defense of lack of consideration given when loan agreement was signed, the loan agreement signed by both parties with interest constituted consideration.
However, the Court determines that during the time plaintiff was a partner, there was a breach of fiduciary duty as plaintiff worked on business ventures unrelated to the partnership when he was supposed to work for the partnership.