WA Business Partnership Fallout - What to Do?

[Hoang Trang]

I've been in a business partnership for 14yrs with no agreement in place; just two brothers taking over a business and distributing 50/50. The initial funds to buy it plus stock, etc., was from our parents.

Relationship has broken down and I've have been forced out of the business and no longer work or receive income from it. Business plus stock is estimated to be approximately $750k. What are my entitlements under commercial law? Partner will not agree to pay me out or sell the business.

 

[Rod]

Sell the business and split the proceeds 50/50.

If your brother doesn't agree then you need to get a lawyer and start the process of forcing a sale.

 

[Hoang Trang]

Sell the business and split the proceeds 50/50.

If your brother doesn't agree then you need to get a lawyer and start the process of forcing a sale.

Thanks for the info. Was on this forum a lot before in regards to my children's custody battle and the good folks here were so much help. Ended up having my kids 78%!!

The business is not setup as a company or trust but a partnership. Was initially on a lease until my brother decided to purchase the freehold without my knowledge. It was only when the broker came to me to sign the mortgage papers having me as 1% that I find out. As I was about to invest into real estate at the time and didn't want additional liabilities to compromise my lending capacity that I didn't kick up a fuss.

So as of now he owns the freehold ( me at 1%) no lease, but both of us are on the partnership business. Legally there is no way he can remove me without my consent?

 

[Clancy]

Have you completed the property settlement with your ex wife yet? If not, then you have to think about if your share of the business is worth fighting for, plus all the legal costs of doing that, then if you won, afterward had to give half of that share to your ex!? Or talk to your ex and see if she will pay half the legal costs to fight for your half of the business and later she gets half of that? (if you win)

 

[Hoang Trang]

have you completed the property settlement with your ex wife yet? If not, then you have to think about if your share of the business is worth fighting for, plus all the legal costs of doing that, then if you won, afterward had to give half of that share to your ex!? Or talk to your ex and see if she will pay half the legal costs to fight for your half of the business and later she gets half of that? (if you win)

The ex and me never entered into a property settlement. She never pursued or came after my assets. We have been officially divorced for 3 years now. Only thing that we fought over was time with kids.

 

[Clancy]

The ex and me never entered into a property settlement. She never pursued or came after my assets. We have been officially divorced for 3 years now. Only thing that we fought over was time with kids.

Ok, well your supposed to arrive at a property settlement within 12 months of getting divorced. What exactly happens beyond 12 months is unclear to me?

 

[Hoang Trang]

Ok, well your supposed to arrive at a property settlement within 12 months of getting divorced. What exactly happens beyond 12 months is unclear to me?

I'm pretty sure you can still apply for the courts to split assets past the one year limit. But would need some really strong grounds to argue.

 

[Hoang Trang]

Sell the business and split the proceeds 50/50.

If your brother doesn't agree then you need to get a lawyer and start the process of forcing a sale.

He can't just take me off the business partnership without my consent? Start up a new business trading name and ABN and continue?

 

[Rod]

No. Getting your evidence together to prove your claims can be the hard part.

 

[Hoang Trang]

No. Getting your evidence together to prove your claims can be the hard part.

Thanks, good to know. So if I want my 50% or thereabouts, what evidence would I need to gather?

After all we've been in business together 14yrs and partnership distributions have always been split half each. If it does end up needing to be forced sold by the courts, what would his case be against it?