Legal Question in Business Law in Arizona
what needs to be filed to stop the sale of a business till partnership issues are resolved?
2 Answers from Attorneys
The answer depends upon the facts of the case and what the partnership agreement provides. It is also assumed that you have indeed formed a partnership, as many business people form a corporation or other entity and still refer to themselves as "partners." Without more facts, I could not determine what legal cause(s) of action you may have to prevent a sale of the business. You must also be able to prove the facts that you allege. You do not state that there is or is not an agreement to sell the business signed by buyer and seller.
This falls in the general category of "business divorce," i.e. partners not agreeing on the operation of the business and one or more partners start acting unilaterally. If there is a written partnership agreement, its terms on the right to sell would control. (emails might do the same thing) Typically, there is not a written partnerhsip agreement and the relationship may be an LLC or corporation in which the owners are colloquially called "partners" but are subject to corp or LLC law and Bylaws or LLC Operating Agreement. If no entity is formed and there is no written agreement, then the default terms of the Uniform Partnership Act would govern. Under that Act you could be made a party to a sale of assets even over your objection. Bottom line unless you have an entity which law for that entity would govern, or you have a written partnership agreement with terms relating to power to sell, your recourse will be to hire an attorney. And if a TRO (temproary restraiinng order) is necessary that is expensive. There is no low cost way to deal with this and the consequences are even more damaging. You need to hire a lawyer A.S.A.P.
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