Legal Question in Business Law in California
Verbal Partnership Agreement- Problems
I entered into a partnership in January 2009. From the beginning, she waged war against another company in our industry. I informed her to cease speaking of or to this company. She continued, going so far as to make libelous statements via email to mutual suppliers. She also used a different company's shipping account and charged freight charges to this account with out my or the other company's knowledge, setting up more potential legal problems for our business. I decided I needed to get rid of her before she got us sued, so I told her I wanted out. This was on Monday. We currently had orders for our business that were taken by our independently contracted sales rep. She is demanding that we cease all business immediately, even though many orders were placed before the decision to terminate our business relationship. Understandably, the contractor is upset that he may lose money he worked hard for if those orders are not fulfilled. I have told her I only want to finish out current business, and will not initiate any new business, but she says that if I fulfill these orders she will take legal action. Can I legally finish out the current business since no formal dissolution agreement has been made yet?
4 Answers from Attorneys
Re: Verbal Partnership Agreement- Problems
This sounds like something that would be best resolved through mediation - you might otherwise spend a lot of money on litigation costs. Both you and your partner risk liability to the contractor for not following through on your promises to the contractor. You have a reasonable argument to close all current business by splitting the orders.
Re: Verbal Partnership Agreement- Problems
This is why partnership agreements should always be well thought-out and put in writing. You will probably now need a lawyer to resolve these problems. Mr. Knisbacher may be right about mediation, but even there you should be represented by counsel if at all possible.
Re: Verbal Partnership Agreement- Problems
There are a lot of questions to be answered. Your situation needs to be examined, and you need to find a way to resolve outstanding issues or separate the business from her. You need to work out a settlement, and you need to make sure you avoid incurring greater liability. The solution will involve the other party, the business itself, and contractors and people you do business with. Please contact my office if you want me to assist you. You need an attorney.
Best,
Daniel Bakondi, Esq.
IMPORTANT:
No attorney-client nor confidential relationship is created through this communication. You may not rely in any way on this communication, and nothing herein constitutes legal advice nor legal opinion. Your issue may be time sensitive and may result in loss of rights if you do not obtain an attorney immediately.
Re: Verbal Partnership Agreement- Problems
There are a lot of questions to be answered. Your situation needs to be examined, and you need to find a way to resolve outstanding issues or separate the business from her. You need to work out a settlement, and you need to make sure you avoid incurring greater liability. The solution will involve the other party, the business itself, and contractors and people you do business with. Please contact my office if you want me to assist you. You need an attorney.
Best,
Daniel Bakondi, Esq.
IMPORTANT:
No attorney-client nor confidential relationship is created through this communication. You may not rely in any way on this communication, and nothing herein constitutes legal advice nor legal opinion. Your issue may be time sensitive and may result in loss of rights if you do not obtain an attorney immediately.
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