BT-I

This is an appeal by a limited partner that was squeezed out of the partnership when the general partner purchased and foreclosed a deed of trust on the partnership’s sole asset, an office building.

BT-I, the limited partner, brought this action against The Equitable Life Assurance Society of the United States (Equitable), the general partner, alleging breach of fiduciary duty, breach of contract (three causes of action) and breach of the covenant of good faith and fair dealing. The trial judge sustained Equitable’s demurrer without leave to amend and entered judgment for it on the complaint. He found the partnership agreement authorized Equitable’s conduct and relieved it of any duty to BT-I, and Equitable was free to foreclose after it offered the loans to the partnership at its own cost and the partnership declined. He determined BT-I suffered no damages, first because it could not recover for tax liability imposed as a result of Equitable’s purchase of the debt, and second because it had no equity in the building with more than $64 million in debt when the only offer received for it was for $39 million.

BT-I argues the limited partnership agreement could not…