Bunnett (P) and Smallwood (D) became partners in the business of buying and selling fertilizer, feed supplements, and hay. The company was incorporated with each party owning 50%. In August 1984, D resigned and started his own company to compete with his own corporation. D was accused by P of using his former status to gain credit for his new company. P then sued D. D, and P then decided to settle their problems in an oral agreement. P received D's stock, and P dropped the lawsuit. Other suits were filed by P and D claimed that he had a release from liability for any and all claims of any kind that P had against D. The trial court found for D and awarded him $30,000 for attorney fees and costs to defend the new lawsuits. P appealed.

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