FACTS

Rose was a partner in an accounting firm. The partnership agreement permitted partners to pursue other business interests so long as doing so did not conflict with the partnership practice. Rose performed accounting work for Right Away Foods and Payne, taking the compensation personally. Rose$$s partners claimed he owed them a share in that he had competed with the firm in violation of the partnership agreement. The jury held for Rose. The partners appealed.

Chief Justice Nye

$*****$

The partnership agreement $...$ provided in part:

Except with the express approval of the other partners as to each specific instance, no partner shall perform any public accounting services $...$ other than $...$ on behalf of this partnership.

Partners $...$ occupy a fiduciary relationship $...$ which requires of them the utmost degree of good faith and honesty in dealing with one another$[.]$

page $389$

It is undisputed that $...$ Rose rendered accounting services for Right Away Foods for which he $...$ received payment personally. $[$The$]$ partnership did not share in the proceeds$[.]...$ The preponderance of all the evidence clearly establishes that Rose $...$ performed accounting services $...$ in competition with the partnership. The $[$jury$]$ was in error.

$...$ Rose also admitted that he performed accounting services for $[$Payne$]$ for which he $...$ received payment personally. $[$His$]$ testimony that he performed the services, in effect, after hours, or in addition to his duties to the partnership, is of no value in light of the obligations imposed by the partnership agreement$[.]$

Questions

Why was Rose$$s work for Right Away Foods considered a violation of the partnership agreement?

Why did Rose$$s $$after$-$hours$$ argument fail?

Could Rose operate a car wash without violating the partnership agreement?