Legal Question in Business Law in Georgia

If your business partner suddenly decides they want to buy out your share of the business and there is no formal written agreement, are there any laws protecting the other partners rights. The business just started in June and the partner who wants to buy the other one out,but still owes the other partner her original investment. Instead of monetary payback, the partner wants the items purchased with that money. Is that a reasonable request? And how can this be settled?


Asked on 2/13/14, 5:41 am

2 Answers from Attorneys
Glenn M. Lyon, Esq. MacGREGOR LYON, LLC, Business Attorneys

Absent a contractual obligation to do so, you cannot be forced to sell your interest in the business. As such, it is all a matter of negotiation to be bought out. No one can tell you whether their offer is reasonable without knowing all of the facts.

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Answered on 2/13/14, 7:10 am
Glen Ashman Ashman Law Office also dba Glen Ashman Attorney

As you have found out you did everything wrong up until now. Without an agreement, no own knows who owns what, or who owes what. You have a mess that was 100% avoidable.

Partnerships should NEVER be oral. And no one should ever start a business without a CPA and a lawyer. It SAVES you money. At this point you have to spend money on a lawyer to analyze what has happened and determine your rights. You may end up in a very expensive lawsuit that was avoidable with a very inexpensive piece of paper. No one can force you to agree to anything without a court case, but it is safe to say you will have more legal fees now than you would have had you started the business properly. Dissolving a business has legal and tax ramifications, so you need that CPA and that lawyer now, and everything should be in writing and reviewed first by your lawyer.

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Answered on 2/13/14, 7:33 am


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