Business partner doesn’t want to pay me out

Discussion in 'Legal' started by Ceodesigns, Aug 13, 2018 at 12:05 AM.

  1. Ceodesigns

    Ceodesigns UKBF Newcomer Free Member

    3 0
    Hello,

    I’m in a tricky situation at the moment with my business partner since I am in the process to leave our limited company (e-commerce business)

    We are both shareholders and the directors of the company which means we share and own 50/50 of the company. We don’t have no shareholder agreement due to our previous history (he is my ex intimate partner).


    However after 2.5 years of designig the prints for our t-shirts, doing all the admin work, accounts, etc and developing new ideas he decided to treat me badly and verbal assaulted me as well as racial discriminated me several times.

    I cannot work in this bad and toxic work environment anymore! (This has been going on over 5 months now)

    I decided to resign soon as a company director and sell my shares to him once I get the company valued and we both agree to the buy out valuation.

    My questions are now
    1) what happens if he isn’t willing to buy me out?

    2) As I’m still a director and shareholder can I still receive my wages and don’t work for the company until he pays me out since I cannot be in the same office with him due to his harassment and bad behaviour?

    3) can I set up a company now (I won’t be a competitor since it has nothing to do with what we are selling now)

    Sorry, English isn’t my mother tongue :)
     
    Posted: Aug 13, 2018 at 12:05 AM By: Ceodesigns Member since: Jul 18, 2018
    #1
  2. Mr D

    Mr D UKBF Legend Free Member

    8,219 838
    1. You keep your shares.

    2. What is the company policy on paying staff who are not working?

    3. Yes.
     
    Posted: Aug 13, 2018 at 2:42 AM By: Mr D Member since: Feb 12, 2017
    #2
  3. Mark T Jones

    Mark T Jones UKBF Enthusiast Free Member

    1,904 513
    As a shareholder, you will keep your shares until a sale is agreed.

    You have certain rights - dependent on the percentage shareholding - the key right is to be annoying and ask for information.

    If you aren't working there I'm sure your partner would be within their rights to terminate your employment. In any case, you would need to resign if you wanted to set up in competition as this would be a clear breach of your responsibilities.
     
    Posted: Aug 13, 2018 at 8:55 AM By: Mark T Jones Member since: Nov 4, 2015
    #3
  4. Supercoach

    Supercoach UKBF Regular Free Member

    271 51
    You have considerable employment rights even if you don't have a contract of employment and he can't just decide to terminate you for not working let alone threaten you or racially abuse you!

    The leverage you have to get him to buy your shares (which he doesn't have to do) is to use employment law to force him to the negotiating table.
    Contact a specialist employment lawyer on the forum for an initial discussion.
     
    Posted: Aug 13, 2018 at 1:41 PM By: Supercoach Member since: Feb 10, 2015
    #4
  5. Paul Norman

    Paul Norman UKBF Ace Free Member

    2,275 666
    As stated above, your only real option is to negotiate the sale of your shares. They may not be worth the amount you gave for them. Indeed, they may have only a notional value. In any case, the other shareholder is not obliged to buy them.

    The issue of the bad treatment is different, and covered by employment law. It is likely that you have some redress in that matter, but that will only benefit you if the company has funds with which to pay you. It is one for the HR specialists here.

    As a general piece of advice, which I repeat often, and is sadly too late for you, never, ever get into this position.

    A Shareholders agreement, and a contract of employment is very important. If the person is known to you, or a close friend, or a husband or wife, the it is about 4500 times more important. And it should spell out, in precise detail, what to do on the date you want to go separate ways.
     
    Posted: Aug 13, 2018 at 2:07 PM By: Paul Norman Member since: Apr 8, 2010
    #5