1. Clyde and Betty Penley were married in 1949. In late 1967, Clyde operated an automotive tire business while Betty owned an interest in a Kentucky Fried Chicken (KFC) franchise. That year, when Betty became ill, she requested that Clyde begin spending additional time at the KFC franchise to ensure its continued operation. Subsequently, Betty agreed that if Clyde would devote full time to the KFC franchise, they would operate the business as a joint enterprise, share equally in the ownership of its assets, and divide its returns equally. Pursuant to this agreement, Clyde terminated his tire business and devoted his full time to the KFC franchise. On December 31, 1979, Betty abandoned Clyde and denied him any rights in the KFC franchise. Clyde sued to enforce the agreement with Betty. Is the agreement enforceable?
1 Answer from Attorneys
The agreement, depending on some details, will likely be enforceable. Basically, Clyde and Betty created a partnership. Missouri has an entire section of the Missouri Statutes devoted to the creation, management, and dissolution of partnerships.
Clyde's time is a perfectly good contribution to the business. In the event of dissolution, sale, transfer, etc., Clyde's time will be given an monetary value, equal to the amount of money Betty will receive.
Clyde's suit, if not brought in a timely fashion could be time barred. Missouri contracts are either 5 year or 10 year (depending on what is being sued for) statutes of limitation for suit. The agreement could possible extend the time for suit, but under statutet, it can't limit it (although most business contracts do just that).
If you have any questions, please don't hesitate to call.
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