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You can search the entire site. or go to the recent opinions, or the chronological or subject indices. Wyller v. Madsen (5/9/2003) sp-5689

Wyller v. Madsen (5/9/2003) sp-5689

     Notice:   This opinion is subject to correction  before
     publication  in  the  Pacific  Reporter.   Readers  are
     requested to bring errors to the attention of the Clerk
     of  the  Appellate  Courts, 303  K  Street,  Anchorage,
     Alaska 99501, phone (907) 264-0608, fax (907) 264-0878,
     e-mail corrections@appellate.courts.state.ak.us.


            THE SUPREME COURT OF THE STATE OF ALASKA
                                

CHRISTIAN F. WYLLER,          )
                              )    Supreme Court No. S-10224
             Appellant,            )
                              )    Superior Court No. 1JU-91-1772
CI
     v.                       )
                              )    O P I N I O N
DONALD MADSEN, HENRY          )
WILDE, ANITA WILDE, and JAMES )    [No. 5689 - May 9, 2003]
CUMMINGS,                )
                              )
             Appellees.            )
________________________________)


          Appeal  from the Superior Court of the  State
          of  Alaska, First Judicial District,  Juneau,
          Walter  L. Carpeneti and Patricia A. Collins,
          Judges.

          Appearances:     Philip    M.     Pallenberg,
          Batchelor,  Pallenberg & Associates,  Juneau,
          for Appellant.  Bernd C. Guetschow, Bernd  C.
          Guetschow,    A   Professional   Corporation,
          Anchorage, for Appellees.

          Before:    Fabe,  Chief  Justice,   Matthews,
          Eastaugh,  and Bryner, Justices.  [Carpeneti,
          Justice, not participating.]

          EASTAUGH, Justice.

I.        INTRODUCTION

           Alaska Statute 32.05.330(b) permits a partner who  has

not  wrongfully  caused dissolution of a partnership  to  recover

damages   from  each  partner  who  has  wrongfully  caused   the

partnership  to dissolve.  Christian Wyller was a  partner  in  a

partnership which owned an office building in Juneau.  He  sought

damages   from   other  partners  following   the   partnership's

dissolution.   The  superior  court, holding  that  Wyller's  own

wrongful acts had contributed to the dissolution, denied Wyller's

claim  for  damages.   We affirm, because we  conclude  that  the

superior court did not clearly err in finding that Wyller's  acts

contributed to the dissolution.

II.       FACTS AND PROCEEDINGS

           Christian  Wyller  was  a partner  in  the  Wildmeadow

Village  partnership.   The partnership was  formed  in  1984  to

manage  Wildmeadow  Village,  a three-story  office  building  in

Juneau.  As of 1984 the partnership consisted of Anita and  Henry

Wilde, Donald Madsen, Christian Wyller, and James Cummings.1  The

Wildes,  Madsen,  Wyller, and Cummings each owned  a  twenty-five

percent  interest in the partnership.  The voting interests  were

aligned with the ownership interests, and the Wildes jointly held

a  single  vote  for  management purposes.  Madsen,  Wyller,  and

Cummings were each entitled to a single vote.

           Under difficult economic circumstances the partnership

received  an Invitation to Bid (ITB) from the State of Alaska  in

January  1991 to lease approximately 7,000 square feet of  office

space for five years.  Madsen and Henry Wilde submitted a bid  on

the   state  ITB  without  procuring  a  majority  vote  of   the

partnership, and in violation of the partnership agreement.   The

state  subsequently advised the partnership that it was  the  low

bidder on the ITB.

          The partners held a partnership meeting on February 10,

1991  to  discuss  the state ITB.  At that meeting  the  partners

approved  the  state lease and various improvements necessary  to

meet the bid specifications.2

           The  partnership's bid involved only portions  of  the

second and third floors of its building.  Madsen reported at  the

February  10  meeting that improvements of roughly $120,000  were

necessary   to  meet  the  state  bid  -  $70,000  for   heating,

ventilation,  and  air  conditioning  (HVAC)  repairs,  and  some

$50,000 for other tenant improvements.3  Madsen explained that he

prepared  a  loan package request for $120,000 to submit  to  the

National  Bank of Alaska (NBA) to finance the improvements.   All

four  partners approved submission of the loan application.   The

application anticipated personal guarantees by the partners.

           After the February 10 meeting, additional improvements

beyond  those required by the state lease were discussed  by  the

Wildes,  Madsen, and Wyller, but not approved.  Time  constraints

prevented  the  partnership from finalizing the loan  application

before contracting for the work necessary to meet the state's bid

specifications.   Madsen  retained a  contractor,  Holaday-Parks,

Inc.,  to  perform repairs on the building, and Madsen and  Henry

Wilde  authorized work to the entire building, including  repairs

not  necessary for the state lease and not properly  approved  by

the  partnership.4   The total cost of repairs  and  improvements

actually  made  to the building was $257,000.  This significantly

exceeded  the  estimated expenses discussed at  the  February  10

meeting, and the $120,000 loan package presented to the bank.

          In mid-April 1991 NBA notified the partnership that NBA

would not lend $120,000 to the partnership under the terms of the

loan  application.  The bank refused to allow the partnership  to

borrow   the  money,  and  requested  that  the  partners  either

individually  or  jointly provide collateral independent  of  the

partnership.   The partners did not contemplate a loan  with  the

requirement  of  personal  collateral  when  they  approved   and

submitted the loan application.

           In  a meeting that began May 6, 1991 and continued  on

May  8  and  May 23, 1991, the four partners discussed  financing

options  in  light of the bank's loan refusal.  Wyller  expressed

reluctance  to  pledge cash or personal collateral  for  a  loan,

objected  to substantial expenditures made without authorization,

and said that he was at the limit of his resources.

            The   partnership  meeting  degenerated,  and  Wyller

repeatedly  voiced  the  opinion that  the  partnership  was  not

authorized to pay the construction costs.  On May 23 Wyller asked

that  management  not  "indulge[]  in  any  excessive  costs  for

anything   on   the  building  above  the  normal  month-to-month

expenses,  the  utilities and what have you."  On  appeal  Wyller

acknowledges  that during the May meetings both he  and  Cummings

"stated that they did not consider themselves responsible for the

construction   costs,  since  they  had  been  incurred   without

authorization."

           Madsen informed the partners that the bills needed  to

be  paid, and told Wyller and Cummings that they were putting him

in  an  "untenable position" by denying authorization to pay  the

construction  costs.  The construction bills were not  paid,  and

Holaday-Parks    brought   suit   against   Wildmeadow    Village

partnership, its individual partners, and various lienholders  on

the  Wildmeadow Village building.  The complaint spawned counter-

and  cross-claims by all four partners.  The underlying claim  by

Holaday-Parks was settled shortly before trial, and the case  was

tried only on the cross-claims among the partners.  After a bench

trial  in  December  1992, then-Superior Court  Judge  Walter  L.

Carpeneti  entered  Findings of Fact,  Conclusions  of  Law,  and

Orders  dated  August  13, 1993.  Judge Carpeneti  ruled  on  the

various cross-claims, and ordered an accounting and winding up of

the  partnership.  With minor exceptions, Judge Carpeneti  denied

motions  for reconsideration from Wyller and Cummings on February

6, 1995.

          The winding up process took some time, and the case was

ultimately  transferred  to  Superior  Court  Judge  Patricia  A.

Collins.   The partnership's only asset, the office  building  in

Juneau,  was  eventually sold.  Notwithstanding the extended  and

contentious litigation, Judge Collins found that after  the  sale

there  was, "remarkably, approximately $410,000 to be distributed

to the partners, less their capital contributions."

            Judge   Collins  entered  an  order   regarding   the

distribution  of  partnership funds  on  December  14,  2000  and

reconsidered  certain factual issues related  to  the  post-trial

findings of Judge Carpeneti.  Judge Collins then entered a  final

judgment May 5, 2001 from which Wyller now appeals.

           The  issues Wyller presents on appeal stem from  Judge

Carpeneti's  1993 findings of fact and conclusions  of  law.   At

trial  Wyller  argued that he was entitled to  damages  under  AS

32.05.330(b)(1)(B), which gives partners who have not  wrongfully

caused dissolution of a partnership a cause of action for damages

against  each  partner  who has wrongfully  caused  dissolution.5

Judge Carpeneti found Wyller "partially at fault for causing  the

dissolution  of  the partnership," and therefore  concluded  that

Wyller was "not entitled to damages under the statute."

           Wyller now appeals Judge Carpeneti's finding on the AS

32.05.330(b) claim, and asks that we remand for determination  of

his damages.  Wyller also appeals Judge Carpeneti's determination

that  no  party  was  the prevailing party for  the  purposes  of

awarding attorney's fees under Alaska Civil Rule 82.

 III.     DISCUSSION

          A.   Standard of Review

           Alaska  Civil Rule 52(a) provides that "[f]indings  of

fact  shall  not  be  set  aside unless clearly  erroneous."   "A

finding  is  clearly erroneous if it leaves  this  court  with  a

definite and firm conviction on the entire record that a  mistake

has been made."6  We apply a clearly erroneous standard of review

to   factual  findings  relating  to  the  cause  or  causes   of

partnership dissolution under AS 32.05.330(b),7 and take the view

of the evidence most favorable to the prevailing party at trial.8

To the extent Wyller's appeal involves mixed questions of law and

fact,  we will evaluate the legal questions separately, and apply

our  independent judgment adopting the rule of law that  is  most

persuasive in light of precedent, reason, and policy.9





          B.    The Superior Court Did Not Clearly Err in Finding

          Wyller  Partially  at  Fault  for  Dissolution  of  the

     Partnership.

                    In its August 13, 1993 conclusions of law the

          superior  court stated that "[b]ecause  the  court  has

          previously   found  that  Cummings  and   Wyller   were

          partially at fault for causing the dissolution  of  the

          partnership, they are not entitled to damages under [AS

          32.05.330(b)]."  The record suggests that  the  court's

          reference  to  its  "previous  findings"  referred   to

          findings  of fact Nos. 18 and 19 issued that same  day.

          In  Finding  No.  18  the court observed  that  shortly

          following the bank's loan refusal, "Cummings and Wyller

          informed  Madsen and Wilde that they did  not  consider

          themselves  bound to provide financing for any  of  the

          improvements which by that time had been  made  to  the

          property."   In  Finding No. 19 the  court  noted  that

          "Cummings and Wyller refused to proceed with  the  loan

          application despite their approval of the  state  as  a

          tenant, and despite their approval of submission  of  a

          loan package."  The court continued in Finding No.  19,

          adding  that  "[t]heir  later claims  that  the  entire

          contract  with Holaday-Parks was entered  into  without

          permission,  or that the bank's financing  requirements

          were  somehow Madsen's fault, are not supported by  the

          evidence."

                     In  response to Wyller's allegation that the

          court did not explain why he was partially at fault for

          dissolution of the partnership, the court's December 8,

          1994  order  on reconsideration referred  back  to  the

          substance  of  Findings Nos.  18  and  19.   The  court

          reiterated  Finding  No.  18, adding  that  Wyller  and

          Cummings told Madsen and the Wildes that they  did  not

          consider themselves bound to provide financing for  any

          of the improvements "without justification."  The court

          also   reiterated  Finding  No.  19,  and  stated  that

          "Cummings and Wyller had refused to complete  the  loan

          application process despite having previously  approved

          the  State of Alaska as a tenant and the submission  of

          the loan application."

                     On  appeal Wyller selectively construes  the

          court's findings.  He suggests that the court found him

          partially  responsible for dissolution, "based  on  the

          fact  that [he] declined to put up his personal  assets

          as  collateral  for a proposed loan."  Proceeding  from

          this  characterization, Wyller urges the court to  hold

          as  a matter of law that a partner is not obligated  to

          pledge  personal  collateral  to  pay  for  partnership

          expenses.

                     Wyller's  characterization  of  the  court's

          findings  is incomplete.  It ignores the rationale  set

          out  in  Finding  No.  18 - that he  wrongfully  denied

          responsibility  for financing any of  the  improvements

          which  by  that  time had been made  to  the  building.

          Wyller  does not deny that he disclaimed responsibility

          for  the construction costs.  In Wyller's own rendition

          of  the facts on appeal he acknowledges that "[a]t  the

          May  23,  1991  meeting, both [he and Cummings]  stated

          that  they did not consider themselves responsible  for

          the  construction costs, since they had  been  incurred

          without  authorization."   Wyller  did  not  want   the

          partnership  to pay for any of the construction  costs;

          he  did not limit his objection to costs related to the

          unapproved  improvements.   This  is  clear  from   his

          expressed  desire at that meeting that  management  not

          "indulge[] in any excessive costs for anything  on  the

          building above the normal month-to-month expenses,  the

          utilities  and  what have you."  In  Wyller's  pretrial

          memorandum  he explained that in the May 1991  meetings

          both   he   and  Cummings  "demanded  that  no  further

          partnership  funds  be  spent  on  the  [Holaday-Parks]

          debt[]."

                     Wyller  was not justified in preventing  the

          partnership  from  paying for any of the  improvements.

          Nor was he justified in denying personal or partnership

          responsibility for these costs.  Madsen and  Wilde  may

          have  bid on the state ITB in breach of the partnership

          agreement,  but  the  superior  court  found  that  the

          partnership,  including Wyller,  subsequently  ratified

          submission of the bid and the state lease, approved  up

          to   $120,000   in  necessary  improvements,   approved

          submission of a loan application, and approved Holaday-

          Parks  as  a  contractor.   These  approvals  are   not

          disputed on appeal.  And given these approvals,  Wyller

          could not then deny responsibility for the $120,000  in

          necessary improvements he authorized.

                      Wyller  acknowledges  on  appeal  that   he

          authorized $120,000 in improvements, and that he  later

          told  the  partnership  he  did  not  consider  himself

          responsible for any construction costs.  The fact  that

          unauthorized improvements beyond those he approved were

          made   to   the  building  did  not  excuse  him   from

          responsibility  for the improvements  he  did  approve.

          The  necessary improvements discussed in  the  February

          10,  1991 meeting were properly approved and benefitted

          the  partnership.   Wyller had no  reason  to  disclaim

          responsibility for them.

                     As  Wyller observes on appeal, "[i]t is well

          established  that, under the Uniform  Partnership  Act,

          partners    are   jointly   liable   for    partnership

          obligations."10   Wyller  implies  that  he  would   be

          personally liable for his portion of the $120,000  only

          if  the  partners  actually agreed to  borrow  $120,000

          instead of simply filing a loan application.  Under  AS

          32.05.100(a)(2), however, partners are liable for  both

          the   "debts   and  obligations"  of  the  partnership.

          Wyller's  argument seems to presume that  "obligations"

          under AS 32.05.100 are restricted to actual bank loans.

          Wyller advances no argument that he was not liable  for

          the obligations the partnership incurred in contracting

          to perform the approved repairs to the building.

                     Once  the partnership authorized contracting

          with  Holaday-Parks  for  the  necessary  improvements,

          neither  the  bank's subsequent loan  refusal  nor  any

          subsequent  breach by the partners excused Wyller  from

          his  obligations regarding his share of  the  $120,000.

          Wyller  may have been excused from obligations stemming

          from the unauthorized portion of the repairs, but it is

          unnecessary for us to address that issue because Wyller

          disclaimed  responsibility for the  construction  costs

          generally - not simply the unauthorized costs.   Wyller

          fails   to  provide  a  justification  for  disclaiming

          responsibility    for   any   of   the    partnership's

          construction  costs, or for preventing the  partnership

          from making payment on any of the construction bills.

                      The  superior  court  found  that  Wyller's

          unjustified  denial of responsibility for  construction

          costs wrongfully contributed to the dissolution of  the

          partnership.   Wyller wrongfully denied  responsibility

          for  any  of the construction costs, and his denial  of

          authorization to pay construction costs contributed  to

          the course of events that precipitated the dissolution.

          Failure  to  pay construction costs brought  about  the

          Holaday-Parks   suit,  and  that   suit   resulted   in

          dissolution of the partnership.  Determining the causes

          of  dissolution is a factual inquiry, and  Wyller  does

          not establish that the superior court clearly erred  in

          finding  that his actions partially caused dissolution.

          Finding  No.  18 justifies the court's conclusion  that

          Wyller   was   ineligible   for   damages   under    AS

          32.05.330(b).

                      Wyller  indirectly  suggests  two  possible

          theories  under  which  his  denial  should  have  been

          excused.    Neither  is  persuasive.    First,   Wyller

          contends that if he did have a duty to pursue financing

          through  the  bank after it rejected the terms  of  the

          loan  application,  his duty was  excused  by  Madsen's

          breach  in authorizing unapproved improvements  to  the

          building.    This  argument  is  unpersuasive   because

          Madsen's breach in authorizing the unapproved work took

          place  after  Wyller and the partnership ratified   the

          state   lease  and  authorized  $120,000  of  necessary

          improvements.  Madsen's breach may have excused  Wyller

          from  liability  for the unauthorized  portion  of  the

          repairs, but it was not a prior breach with respect  to

          the improvements Wyller had previously authorized.  Any

          breach  by  Madsen  in authorizing  unapproved  repairs

          would  not excuse Wyller from obligations flowing  from

          the   partnership's  contract  with  Holaday-Parks   to

          perform approved repairs.

                     Wyller's second potential justification  for

          denying  responsibility for the $120,000 in  authorized

          repairs  is  implied in his contention  that  the  only

          reason  the  partnership needed a loan was to  pay  the

          unauthorized  portion of the expenses.   Wyller  claims

          that  the  partnership  paid  for  $106,000  in  tenant

          improvements  from  its own resources  without  partner

          contributions, and argues that without Madsen's  breach

          in  authorizing  unapproved  repairs,  the  partnership

          would have either required a very small loan or no loan

          at all.

                     As  discussed above, though, Wyller and  the

          partnership  approved $120,000 in  improvements  before

          Wyller wrongfully denied responsibility for any of  the

          construction  costs.  The availability of  $106,000  in

          partnership  resources  to pay  construction  costs  is

          immaterial  to Wyller's wrongful conduct.  He  did  not

          merely  refuse  to  pursue  financing,  he  denied  the

          partnership  authority to pay the  construction  bills.

          And   furthermore,   whether  that   wrongful   conduct

          contributed to the dissolution of the partnership is  a

          factual  inquiry  reviewed under  a  clearly  erroneous

          standard.   Wyller fails to show that his  conduct  was

          not  wrongful,  or  that it did not contribute  to  the

          dissolution  of the partnership.  Viewing the  evidence

          in  the  light most favorable to the prevailing parties

          at  trial,  we conclude that the court did not  clearly

          err   in   finding   that  Wyller's  wrongful   conduct

          contributed to the dissolution of the partnership.

                       Wyller's    claims   regarding   available

          partnership resources are unpersuasive.  Cash  reserves

          sufficient  to cover the cost of the approved  repairs,

          assuming  they  were available, would  not  preclude  a

          conclusion   that  Wyller's  conduct  from   wrongfully

          contributing to dissolution of the partnership.  Wyller

          wrongfully  prevented the partnership from  paying  the

          construction costs - irrespective of its available cash

          flow  -  and not paying construction costs spawned  the

          Holaday-Parks suit and ultimately led to dissolution.11

          The   record  of  the  May  1991  partnership   meeting

          demonstrates  that  it was Wyller's  wrongful  behavior

          that  led  Madsen and the Wildes to seek dissolution.12

          The  trial  court  therefore did  not  clearly  err  in

          finding   Wyller  ineligible  for  damages   under   AS

          32.05.330(b).13

                     Wyller spends the bulk of his appeal arguing

          as  if the trial court found him ineligible for damages

          under  AS  32.05.330(b) because he  refused  to  pledge

          personal collateral for a partnership loan.  He  claims

          that his decision not to pledge personal collateral was

          a  protected business judgment, and urges this court to

          hold that partners are not obligated to pledge personal

          collateral for partnership loans.

                     Wyller  misreads the trial court's decision.

          The trial court did not find against him for failing to

          pledge  personal collateral.  The trial court did  note

          in  Finding  No. 19, and then later on reconsideration,

          that  Wyller  refused to complete the loan  application

          process  despite his prior approval of the state  lease

          and  necessary  repairs.  The court  also  acknowledged

          that  the  partners did not contemplate the requirement

          of  personal collateral in their loan application,  and

          that the variance between the loan application and  the

          bank's requirement of personal collateral was material.

          Nevertheless, these observations should not  be  viewed

          in isolation.  We view Wyller's failure to cooperate in

          the  financing process in the context already discussed

          -  one  in  which he approved the state lease  and  the

          contract   for  the  necessary  repairs  but   declined

          responsibility for any of the construction costs.   The

          court's  observation  regarding  Wyller's  refusal   to

          participate in the financing process was shorthand  for

          describing Wyller's denial of responsibility for any of

          the construction costs despite his prior approvals, and

          his refusal to allow the partnership to pay its bills.

                     It  is not clear to us that the trial  court

          actually  presumed that Wyller had  a  duty  to  pledge

          personal  collateral for a partnership loan,14  but  we

          need   not  speculate  about  the  extent  of  Wyller's

          obligation to pursue financing.  Finding No. 18 and the

          fact  that Wyller denied responsibility for any of  the

          construction  costs  in  the  May  1991   meeting   are

          sufficient to prevent recovery under AS 32.05.330(b).

                C.   Wyller Is Not Entitled to Rule 82 Attorney's

          Fees.

                    Because the superior court did not reversibly

          err in finding Wyller  ineligible for damages under  AS

          32.05.330(b), he was not the prevailing party at  trial

          and  therefore is not entitled to attorney's fees under

          Alaska Civil Rule 82.

          IV.  CONCLUSION

          We therefore AFFIRM the judgment below.
_______________________________
1     The partnership formed in 1984 replaced a partnership  that
included each of these partners except Wyller.
2     The  superior court concluded that Wyller and Cummings  had
ratified  submission  of  the bid and approved  the  improvements
necessary  to  meet the bid specifications after  it  found  that
neither Wyller nor Cummings objected "in any way" to the State of
Alaska as a tenant, or "expressed any objection" to pursuing  the
financing  necessary  to  pay for the  improvements.   On  appeal
Wyller  does  not  dispute his approval of the  bid,  or  of  the
improvements necessary for the state lease.
3     The  amounts of Madsen's cost estimates to the  partnership
were disputed at trial.  Wyller argues on appeal that Madsen told
the partnership that Madsen estimated there would be $120,000  in
necessary improvements - $70,000 for HVAC repairs and $50,000 for
other  work.  Following  the February  10,  1991  meeting  Madsen
estimated the total cost of improvements in a loan application as
$157,000;  at  trial  he  suggested  that  his  estimate  to  the
partnership  was greater than $140,000 ($70,000 for HVAC  repairs
and  $71,000 for other improvements).  The trial court could  not
"verify  the  accuracy" of Wyller's claim that  Madsen  estimated
$50,000  in  non-HVAC  improvements,  but  used  this  figure  to
conclude that Madsen's estimate to the partners was at least that
much.  The court found that Wyller agreed to the expenditure  "of
up to $120,000 for the improvements necessary to secure the state
contract."   We  accept  this finding  because  Wyller  does  not
dispute  on  appeal  that  he authorized  at  least  $120,000  in
improvements necessary for the state lease.
4     The superior court found that Wyller approved the selection
of   Holaday-Parks  as  contractor  either  by  telephone  or  by
ratification because he knew of Holaday-Parks's proposal and  did
not  object.   Cummings  was  not involved  in  the  decision  to
contract  with Holaday-Parks, but the superior court  found  that
once the partners gave unanimous approval to borrowing money  for
the necessary repairs, contracting for the work was a "management
decision" under the partnership agreement, and could therefore be
approved  by  a  majority vote of the partners.   We  accept  the
superior court's finding that three of the four partners approved
contracting  with Holaday-Parks for the necessary repairs,  which
was  sufficient under the partnership agreement at paragraph  19.
Paragraph  19  of  the partnership agreement provided  that  "[a]
majority  vote  of the partners will be sufficient for  approval"
with  respect  to "[a]ll decisions affecting the partnership  and
its policies of management."
5    AS 32.05.330(b)(1)(B) provides:

          (b)    When   dissolution   is   caused    in
          contravention  of  the partnership  agreement
          the rights of the partners are as follows:
          
          (1)    each   partner  who  has  not   caused
          dissolution wrongfully has
          
               . . . .

          (B)   the right, as against each partner  who
          has  caused  the  dissolution wrongfully,  to
          damages for breach of the agreement.
          
6     City  of  Hydaburg v. Hydaburg Coop. Ass'n, 858 P.2d  1131,
1135 (Alaska 1993) (quotation omitted).
7     Schymanski  v. Conventz, 674 P.2d 281, 287  (Alaska  1983);
Geczy v. LaChappelle, 636 P.2d 604, 606-07 (Alaska 1981).
8    Geczy, 636 P.2d at 606.
9     Cockerham  v.  State, 933 P.2d 537, 539 n.9  (Alaska  1997)
(citing Guin v. Ha, 591 P.2d 1281, 1284 n.6 (Alaska 1979)).
10    See AS 32.05.100 (establishing that all partners are jointly
liable  for  contractual debts and obligations of a partnership).
See also 1 William Meade Fletcher et al., Fletcher Cyclopedia  of
the  Law of Private Corporations  20 (perm. ed., rev. vol.  1999)
(observing that partners in a partnership are liable for the full
extent  of the indebtedness of the partnership, and that partners
are  individually entitled to the rights, and individually liable
for   the  obligations,  under  contracts  entered  into  by  the
partnership);  59A Am. Jur. 2d Partnership  639 (2002)  (partners
are  jointly  liable for all debts and obligation of  partnership
not arising from tort or breach of trust).
11     Contrary to Wyller's supposition, the availability of cash
reserves  sufficient  to cover a large portion  of  the  approved
repairs  actually  seems  to reinforce the  wrongfulness  of  his
denial  of partnership authority to pay Holaday-Parks in the  May
1991 meeting.
12    At the May 1991 meeting Madsen told Wyller and Cummings, "I
would  have to say that what you two fellas are doing is  putting
me  in an untenable position . . . . [T]he bills need to be paid,
and  if you're putting me in that untenable position of where the
bills  are not going to now be paid, it's probably time  that  we
got  the judge and the jury involved and got it resolved once and
for all, and I'll move for dissolutionment of the partnership and
I'll  so  proceed  legally to do that."  Madsen  and  the  Wildes
ultimately sought legal dissolution of the partnership.
13     Madsen  and the Wildes each paid $68,000 and  Wyller  paid
$10,000  to  Holaday-Parks  to  settle  the  contractor's  claims
against  the partnership.  The fact that Wyller paid  $10,000  in
the  settlement does not affect our analysis.  Even  if  Wyller's
$10,000 payment covered his share of the balance between payments
made to Holaday-Parks from partnership resources and the $120,000
the  partners authorized for improvements, the settlement payment
was  made subsequent to Wyller's wrongful conduct, the filing  of
the  Holaday-Parks suit, and the chain of events that  the  trial
court found led to dissolution.  The settlement payment therefore
need not bear on whether Wyller contributed to the dissolution of
the partnership.
14    After observing that the variance between the partnership's
loan   application  and  the  bank's  requirement  for   personal
collateral  was  material, the court noted that "the  failure  of
Madsen  to obtain the most favorable terms from the bank did  not
excuse  Cummings  and Wyller from their obligation  to  cooperate
with  the  partnership  efforts  to  locate  financing  for   the
project."   We agree with the court's assessment, and believe  it
falls  short  of  finding Wyller had a duty  to  pledge  personal
collateral for a partnership loan.