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As mentioned earlier, BBP did not maintain a general ledger,
a balance sheet, a sales journal, or a purchases journal. The
partnership did not always maintain a cash disbursements journal
or a cash receipts journal. A calculation of the distributions
made to each partner over the years cannot be made given the
state of BBP’s records. However, we note that the parties agree
that each partner generally withdrew funds from the respective
activity he conducted, and our review of BBP’s tax returns for
the years 1980 through 1994 indicates that the oil and gas
activity was more profitable overall than the farming activity
during this period. Additionally, in the months before Melvin’s
death, some of the assets of BBP were equally distributed between
Melvin (or his children) and Russell.
The fourth factor to consider is the partners’ rights to
distributions of capital upon liquidation of the partnership. At
trial, all the witnesses testified that, prior to Melvin’s death,
they believed that Melvin and Russell shared in the partnership
equally. Stephen testified that, as of Melvin’s date of death,
he believed that BBP was a 50-50 partnership. He further
testified that he believed this because Melvin and Russell each
18(...continued)
payment made on Oct. 18, 1994. Russell Ballantyne was listed as
the payee for two payments totaling $163,419.97. The remaining
payments were made to BBP. Thus, it appears that a portion of
the farm income for 1994 was paid directly to Jean, either to her
personally or on behalf of the estate.
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