If I am manager and 5% owner of a restaurant and the majority owner is using restaurant funds for personal expenses, what actions can I take?

Get Legal Help Today

Compare Quotes From Top Companies and Save

secured lock Secured with SHA-256 Encryption

If I am manager and 5% owner of a restaurant and the majority owner is using restaurant funds for personal expenses, what actions can I take?

Asked on December 27, 2011 under Business Law, Texas

Answers:

Kenneth Avila / Kenneth Avila, Patent Attorney

Answered 12 years ago | Contributor

All owners of a business owe their business certain duties such as duty of due care and loyalty.  Duty of Due Care states that an owner must “discharge their duties to the business with the same degree of diligence, care, and skill which the ordinary prudent person would exercise in the management of his own affairs”.  Duty of Loyalty states that “in all of their dealings with the business owners must promote the interests of the business without regard for personal gain”.  From just your facts it seems as if the majority owner is breaching both of these duties.  However I would advise you to look carefully at agreements between the business and the majority owner to make sure that he is indeed taking money from the business that is not rightfully his and that you carefully and fully discuss this with an attorney.


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.

Get Legal Help Today

Find the right lawyer for your legal issue.

secured lock Secured with SHA-256 Encryption