50% Business partner not pulling weight

[poppy]

Dear all. Any advice would be appreciated.
I run a business with a business partner and we are both 50% directors (1 share each).
I continue to do the lionshare of the work and my partner is virtually a sleeping partner, not contributing much.
If my business partner stops contributing completely or does not match my efforts, but the business continues to be profitable (we have 2 employees), I understand that he is still entitled to half the profits.
Im tempted to suggest that we both become sleeping partners in our existing business and I set up a new business to resolve this problem.
Can anyone suggest a solution or a specialist who would give me advice.
Please ask if further information is required.
Many Thanks.

 

[bwglaw]

I can advise upon sight of any Director Service Contracts and Shareholders Agreements as these agreements will determine how such a situation should be dealt with.

You use a combination of partner, sleeping partner and Directors. I suspect you are a Limited Company, if so avoid using terms such as partners and sleeping partners because this confuses it more.

Im tempted to suggest that we both become sleeping partners in our existing business and I set up a new business to resolve this problem.

Are you implying that you are thinking to let the business run on its own and become insolvent? If it is a Limited Company and you are both Directors then this is a very bad suggestion and there is likely to be a fall back on you both as Directors for failing to carry out your duties in the best interest of the company.

Your situation is not uncommon and more than often they can be resolved by negotiation, especially in the absence of any agreements.

Email me with more information and any contracts and I will advise further

Jonathan

 

[Antonia @limeone.com]

It is certainly a matter on which to take specialised advice. There are a number of ways of resolving disputes over directors' workloads and many of the company directors I advise have no directors' service level or shareholders' agreements in place.

The important thing is not resolve matters before you get to the stage when you feel like walking away. I am happy to advise further, email me on [email protected] or call me on 0161 776 4533. I would like to see the paperwork if there is any, but suspect there is none

 

[autolycus]

May be a daft question, but have you actually spoken to your co-director about your concerns? Maybe he/she thinks they ARE pulling their weight....

 

[RayB]

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I have seen plenty of spam, but this is possibly the worst I have seen here ever

 

[Paula Barrett]

I've deleted that post. Please everyone, do not post unnecessary spam. It is not helpful and will simply be removed by us at Sift or the moderators.

Thank you to the people posting helpful advice...carry on!