Wang v Rong

In the case of Wang v Rong, the dispute centred around the partnership agreement between the first plaintiff and the first defendant, and the obligations and entitlements of the parties under the agreement. The first plaintiff alleged that the first defendant failed to pay him his share of the salary as agreed, while the first defendant claimed that the first plaintiff was not entitled to the salary because he did not work in the partnership business. The matter was heard in the Supreme Court of New South Wales.

The court was required to determine the legal issues of whether the first plaintiff's failure to work in the partnership business disentitled him to the agreed salary distribution and whether there was an implied term in the partnership agreement that reduced the obligation that fiduciary duties would have otherwise imposed. The court also had to consider the proper construction of the partnership agreement and the evidence of the parties' intentions and conduct.

The court found that the distribution of 'salary' and 'wages' was to be paid to the partners in proportion to the work undertaken, particularly given the nature of the business. The court considered the surrounding circumstances and the evidence of the parties' intentions and conduct. The court held that the evidence did not prove that the parties understood that the first plaintiff was solely an investor and would not work in the business. The court also held that post-contract conduct was not admissible in the construction of the present partnership agreement. The court found that the first defendant's conduct was too equivocal to justify a finding of admission. The court held that the first plaintiff was not entitled to a proportion of the salary in the absence of working.

The court ordered that the first defendant pay the first plaintiff his share of the salary as agreed, subject to the caveats set out in the partnership agreement. The court also held that the distribution of the salary was to be credited against the first plaintiff's share of the profits.