323 P.3d 551
Or. Ct. App.2014Background
- SPBC formed in 1999 with Taggart, Jehnke, Hoffard, Benthin; Emmert joins in 2003.
- Taggart transfers SPBC interest to BT of Sherwood, LLC (BT), a 100% Taggart-owned entity.
- BT later becomes owner of Taggart’s BT stake; Taggart’s 25% SPBC interest appears to transfer.
- Berman (SPBC’s attorney) later buys into BT; Taggart and Berman’s related transfers occur through 2007–2008.
- SPBC loans and guarantees; Taggart’s fiduciary breaches and diverted funds precede litigation.
- Trial court voids Taggart transfer to BT for lack of proof under ORS 63.249(6) and expels Taggart; BT has no SPBC interest.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Taggart’s SPBC transfer to BT was valid | Taggart transferred ownership to BT; notice and proof complied. | Notice existed but proof lacked; transfer invalid until proof. | Transfer not valid; SPBC not bound; proof not provided when BT controlled by Taggart. |
| Whether Taggart could be expelled despite the transfer | Expulsion proper due to wrongful conduct; transfer does not defeat expulsion. | If transfer valid, expulsion improper. | Expulsion proper; transfer lacked effectiveness; Taggart expelled January 1, 2008. |
| Whether Emmert and Jehnke owed fiduciary duties to BT | BT could rely on fiduciary duties; breach alleged by BT. | No fiduciary obligation to BT; no breach if any existed. | No fiduciary obligation to BT; no breach. |
| Date and method for calculating Taggart’s buyout | Use January 1, 2008 value and current rate as of judgment. | Use event date of expulsion and relevant rate. | Date of event giving rise to purchase election is the judgment entry date; value calculated accordingly. |
Key Cases Cited
- State v. Gaines, 346 Or 160 (2009) (determine statutory intent by text and context)
- State v. Briney, 345 Or 505 (2008) (plain meaning of terms used in statute)
- Yogman v. Parrott, 325 Or 358 (1997) (contracts interpretation framework)
- Housing Authority of Jackson County v. Gates, 246 Or App 521 (2011) (contract interpretation and appellate review standards)