Reference - Grooming Losses

Multiple Choice

Reference - Grooming Losses. Wally, Beverly, and Matthew formed a partnership to groom dogs. Unfortunately, the business did not go as well as expected and the partnership incurred some losses. The articles of partnership did not allocate profits or losses. Matthew claimed that he should not have to share in losses because he had groomed more dogs than anyone. Matthew also claimed that although the partnership did not reference compensation for additional duties, he was entitled to compensation because of his excessive work. Beverly claimed that she should not have to share in losses because she contributed more capital than did either of the others. Wally claimed that he should not have to cover the losses because both Beverly and Matthew had been hiding the books from him. He demanded to inspect the books and also to a review and listing of all partnership assets and profit. Beverly and Matthew denied that Wally was entitled to a review of the books and stored them in a safe deposit to which only Beverly had a key. They claimed complete innocence of any wrongdoing. Which of the following is correct regarding Matthew's claim to additional compensation based upon the amount of work he was doing?

A) He is correct.
B) Based upon equitable principles he may be correct, but only if he can establish that the other partners wrongfully refused to do their share of the work.
C) He is incorrect.
D) He is incorrect unless he can establish that he honestly did not know the law in regard to partnerships.
E) He is incorrect unless he can establish that he did at least 30% more work than any other partner.