Legal Question in Business Law in Texas

My wife and I formed a partnership with another couple. According to the partnership agreement, we would receive 50% of the net profits immediately for our participation in the business (tax returns, accounting, business plan, marketing strategy, etc.)... however, my wife and I would not have any ownership in the company just yet. In lue of us putting in any Capital, we would acquire ownership based on our sales. $10,000 in sales gives us 10% ownership until we reach a max of $50,000 in sales and become 50% owners. A conflict developed between all the partners and the other couple have cut us off... basically took their ball and went home. Stopped paying us our share of the net profits. What recourse do we have? Do we need to sue them in small claims court? Any advice would be greatly appreciated...


Asked on 2/03/11, 1:49 am

1 Answer from Attorneys
Kevin B. Murphy Franchise Foundations, APC

As a Franchise Attorney I can say this. You need to take the partnership agreement you signed to an attorney and get advice. Without evaluating the entire agreement, as well as all surrounding facts and circumstances, it's not possible to even begin to provide answers to you questions. Consult with a good business or franchise attorney in your area for specific advice.

Mr. Franchise - Kevin B. Murphy, B.S., M.B.A., J.D.

Franchise Foundations, a Professional Corporation

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Answered on 2/09/11, 12:49 pm


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