and thus no duties of the assignees arose.
Plaintiff, however, contends that because Griffin was the trustee of the Wynmark Trust at the time of the exercise of the Options,
the Trust exercised the Options. While a trustee does not have to state explicitly that he is acting in that capacity for his actions to bind the trust,
where the trustee explicitly states that he is acting on behalf of another entity, in this case as Executive Vice President of Wynmark Development, his actions should not, barring other facts, be considered those of Wynmark Trust. See Peyser v. American Sec. & Trust Co., 70 App. D.C. 349, 107 F.2d 625, 626 (D.C. Cir. 1939); Phenix Fed. Savings & Loan Ass'n v. Shearson Loeb Rhoades, Inc., 856 F.2d 1125, 1127-28 (8th Cir. 1988), cert. denied, 489 U.S. 1066, 109 S. Ct. 1340, 103 L. Ed. 2d 810 (1989); Viso v. Werner, 471 Pa. 42, 369 A.2d 1185, 1188 (1977). While plaintiffs are correct that Griffin possessed the authority at the relevant points in time to have exercised these Options, the explicit and unambiguous language of his letters exercising the Options states that he was not acting in his capacity as trustee. Just because someone is a trustee does not mean that every act he takes should be imputed to the trust. Where a trustee explicitly states that he is acting in another capacity, the Trust should not, barring fraud or misrepresentation, be considered a party to those actions.
Our inquiry, however, does not end there. The wrinkle in the instant dispute is that Wynmark Development was both the assignor of the Options in question and the general partner of the 1640 and 514 limited partnerships whose limited partners were Naing, Griffin, and the Wynmark Trust. Deposition Exhibits 13, 16. Therefore, plaintiff argues, when Griffin "exercised" the Options in his capacity as an officer of Wynmark Development, he was doing so because Wynmark Development was the general partner of a limited partnership whose limited partners were the rightful assignees. Wynmark Development, thus, was not exercising an option which it had earlier assigned away, but exercising an option as a general partner on behalf of its limited partners.
Plaintiff relies upon the broad powers conferred on the general partner by the 1640 and 514 Limited Partnership Agreements to support its assertion that NCI was acting as a general partner on behalf of its limited partners when it exercised the Options. Specifically, each agreement states that "no person, firm or corporation dealing with the Partnership shall be required to inquire into the authority of the General Partner to take any action or make any decision." 1640 Agreement § 6(b); 514 Agreement § 6(b). In addition, the agreements state that "by executing [these] Agreements, each Limited Partner shall be deemed to have consented to any assignment consented to by the General Partner." 1640 Agreement § 7(e); 514 Agreement § 7(e). Plaintiff also draws attention to the fact that Wynmark Development always maintained a 1% interest in each limited partnership.
This argument also fails. Plaintiff's argument that Wynmark Development had inherent total authority for all of the limited partnerships' decisions and actions evades the fundamental issue. The Options in question were not assigned to 1640 and 514; they were assigned to Griffin, Naing, and the Wynmark Trust. Thus the inherent authority of the general partner is not at issue because the Options were not the partnerships' to exercise in the first place.
Finally, to require Wynmark Trust to repay the investment credit lost by NCI would require one to be blind to the fact that legally the Options were not exercised by their true owners. NCI was negligent in permitting the transaction to go forward when it knew all the facts.
Accordingly, plaintiff's motion for summary judgment is denied, and defendant's motion for summary judgment is granted. Judgment is entered for defendant and this case is dismissed.
An Order consistent with the above has been filed this date.
ORDER - October 7, 1991, Filed
Upon consideration of plaintiff's motion for summary judgment, defendant's motion for summary judgment, the oppositions thereto, and the entire record herein, and for the reasons stated in the accompanying Memorandum Opinion entered this day, it is by the Court this 7th day of October, 1991,
ORDERED that defendant's motion for summary judgment is granted; and it is
ORDERED that judgment is entered in favor of defendant on all claims raised by plaintiff in this action; and it is
FURTHER ORDERED that this case is dismissed with prejudice.