A former employee at a distribution line of a store selling tobacco products contented that the store was opened as an equal partnership between himself and the store owner and demanded compensation for his exclusion from receiving a share of the store’s profits.
The Court held that no partnership relations existed between the parties. An examination of the existence of a partnership relationship is done by reviewing the nature of the relationship between the parties. Thus, one reviews the parties’ intent, how they present themselves to the public, their participation in the business assets, parties’ equal right to run the business, parties’ mutual right to obligate one another regarding business matters, division of business shares, duration of the relationship, etc. Nevertheless, the most important indication is the participation of the parties in business losses. Here, although the employee participated in the distribution line, the business documents do not reflect any indication of the existence of a partnership, the employee was not present in the store on a daily basis and he did not participate in the assets, profits or losses of the business. In addition, the period of engagement between the parties lasted only about 7 months, which ended. Therefore, no partnership relationship existed between the parties and the employee is not entitled to compensation.