I'm a shareholder in a painting and sandblasting business with 25% ownership in the land, the building and business. My sister, who's now owns 50% and runs it with her son will not pay me anything whatsoever. It's been years since I've received a penny and I tried going thru the courts for relief only that was costing me a small fortune. I live in New Mexico so I'm not there to do anything. I inherited this mess via a Trust from my Dad. It's a S Corp with revenues around $500k.
My question is this: can I appoint a power of attorney to go into the business and get keys to the business, work on weekends, get into the books etc? I figure that the POA can bring work into the business on the weekends and that way I can collect all of the past due dividends, rent, owner disbursements etc.
Would I have to offer the sale of my shares to the other shareholders first?
1 Answer from Attorneys
You are an oppressed minority shareholder. Your remedy is to sue to dissolve the corporation and sell all of its assets at auction. The insiders will try to stop the sale, but the only way they can do it is to buy you out. In connection with that, your attorney gets to audit the books and determine if there were any dividends.
Have you been receiving information returns from the S-corp? As a shareholder in an S corp, you are required to include 25% of the corporate profits in your gross income, whether or not you receive a penny from them.
You have what appears to be a good lawsuit. While the address you'll see is in New York, I am a New Mexico attorney and I am Santa Fe rather frequently.
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