What to do if I went in partnership with 2 other friends in a landmark eestaurant but 1 of the partners started to unilaterlly make all decisions about money, employment hires and vendors?
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What to do if I went in partnership with 2 other friends in a landmark eestaurant but 1 of the partners started to unilaterlly make all decisions about money, employment hires and vendors?
All of this without communicating or voting and has become unbearable to be in contact with. We are incorporated and each own 33%. Myself and the third partner both have decided to walk and let him buy us out. We gave him an altamadom to come up with negotiated buy out first, since he wanted it for himself or we would go to open market. He has a pattern to borrow money without knowing how to pay it back, even from our Managers boyfriend without our knowledge (that was the last straw) so we are extremely nervous about our names on the lease and financial future. What are our legal rights?
Asked on January 27, 2013 under Business Law, California
Answers:
M.T.G., Member, New York Bar / FreeAdvice Contributing Attorney
Answered 11 years ago | Contributor
Do you have a partnership agreement about running the restaurant? If not then given you percentages of ownership you probably all have equal say and rights. If his actions are threatening the business you need to take action to limit him in court. Do not make him a signatory or allow him the ability to borrow. Seek legal help. Good luck.
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