What to do about a failed business buy-out?

UPDATED: Feb 10, 2012

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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


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 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.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

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