What to do about a failed business buy-out?
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What to do about a failed business buy-out?
Business partner said he was going to buy me out so I got a different job. Came down to it and he changed his mind. He is now starting a different business doing the same thing and just changed the name and left me with my half of the debt. Is this legal?
Asked on February 10, 2012 under Business Law, Oklahoma
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 12 years ago | Contributor
You should speak with an attorney about his situation--you may have recourse:
1) Business partners have certain duties towards each other imposed by law; if he breached these duties, you may be able to seek recovery.
2) If there was an agreement between you that he would buy you out, that agreement may be enforceable.
3) Even without an enforceable agreement, if he promised or represented to you that he would buy you out; it was reasonable to rely on that promise; in reasonable reliance, you took actions to your detriment; and he knew or should have known you'd take actions to your detriment, but made the promise anyway--that may be sufficient to make the promise of buying you out enforceable, under the theory of promissory estoppel.
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