Legal Question in Business Law in New Jersey

I've been in business for two years with my business partner, unfortunately, we haven't got a shareholder or buy out an agreement in place. I ma very concerned about this and have made several attempts to encourage my business partner to be on board in putting an agreement together. I served an agreement on him back in 2015 which he ignored, recently I sent him the same draft insisting that he respond so we can move to have it bound and filled as a legal document.

Not wanting to sound mistrusting, I'm concerned that in getting the impression my business partner is possibly deliberately avoiding this.

I need advice how to move forward with this and enforce that an agreement is immediately put in place.

Thank you


Asked on 5/07/17, 8:22 pm

3 Answers from Attorneys

Barry Gartenberg Barry F. Gartenberg LLC

I am a business attorney. Partnership disputes and avoiding partnership disputes are a large part of my practice. I invite you to call me for a free telephone consultation to discuss your circumstances and explore your options. 973-921-0600. Thanks.

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Answered on 5/08/17, 5:55 am
Roman Fichman Esq. Law Practice of Roman Fichman Esq.

I agree with you that it is a significant problem . Unfortunately you cannot "force" your partner to enter into such an agreement. But you can do the following three things:

1) Learn about default provisions in the law that equitably protect partners by default without having to enter into an agreement.

2) if your company documentation is missing (many times in small companies the necessary paperwork is not in place) then you could demand that your partner agree to enact those documents (for example, an operating agreement / bylaws) and then include the relevant buy-out provisions in those documents.

3) Finally, a strategy that has worked in the past was to ask the other partner for their opinion on a smaller issue (even if informally) -- for example ask something like: "what would YOU like to see happen if I cannot do my job for 4 months straight?" then if the answer is agreeable then say in writing that you agree. Your partner's answers to these types of question would in effect resolve the issues that are covered in buy-out agreements --

I have a method that is made up of a series of clever questions that is designed to answer many if not most of the issues that are typically addressed in a buy out agreement. Call me.

Roman R. Fichman, Esq.

www.TheLegalists.com │ @TheLegalist

email: Info (@) TheLegalists (dot) com

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Disclaimer: This post has been written for educational purposes only and was not meant to be legal advice and should not be construed as legal advice or be relied upon. No intention exists to create an attorney-client relationship or any other special relationship or privilege through this post. The post may contain errors, inaccuracies and/or omissions. You should always consult an attorney admitted to practice in your jurisdiction for specific advice. This post may be deemed as Attorney Advertising.

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Answered on 5/08/17, 6:49 am
Frank Natoli Natoli-Legal, LLC

As noted, you really can't do anything to make your partner enter into an agreement now. This is what we call "closing the barn doors after the horses have runaway." There are however default rules based on the type of entity or for default general partnerships that may address many of your concerns, so you should visit them in the meantime.

Your partner should also want to have a clear written agreement because it will also help protect him as well.

I suggest that you consult with a lawyer in private and discuss your objectives in more detail. You can start by calling around to several for a free phone consultation, get some insights then pick the best fit to work with.

If you would like to discuss further over a free phone consult, feel free to contact me anytime that is convenient.

Our firm is now referred by the American Bar Association (see under the New York section):

http://www.americanbar.org/groups/delivery_legal_services/resources/programs_to_help_those_with_moderate_income.html

Kind regards,

Frank

www.LanternLegal.com

866-871-8655

[email protected]

DISCLAIMER: this is not intended to be specific legal advice and should not be relied upon as such. No attorney-client relationship is formed on the basis of this posting.

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Answered on 5/08/17, 8:17 am


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