"Partner" recently left our partnership the beginning of this month. Sent me an email with his "Buy-out", stating that all he wanted was 50% of the cash in business account. I agreed to the terms. Partner took his 50% and now won't sign his dissolve papers, stating that he "..will not take anything less than $20,000 for his buyout.".
I'm a wholesaler and have two closings coming up once the title work comes in. I've spoke with my attorney and she advised me to:
1. Take the checks from closing.
2. Deposit into business account (which is shared with my "partner"), then either withdraw the money or transfer it to my personal account.
3. Dissolve the bank account (Bank won't allow me to remove him without, you guessed it, signatures from both of us!).
4. Terminate the Entity, by "Winding" it up then officially "Terminating" it.
Ex-partner is currently building his own business/brand while I'm stuck in lingo because he won't sign the papers.
My attorney said "There is no way your business is worth $40k, he (ex-partner) sounds like a joke.". I laughed and agreed as it's a wholesale business/partnership. We don't hold any properties or anything of value in the LLC. the bank account is currently -$173 (Attorney and I laughed at that too). I want to pay off the negative balance and make sure I'm safe picking up the checks when closing comes, and I get paid. Knowing that he did what he did I can easily see him trying to snag these checks from me, then cashing them each. He knows about them because I got the properties all under-contract using Dotloop, but forgot to change the Dotloop password!
Now why did this partnership get to this point? I wish I had the answer. I was in the hospital for a week after being stabbed one-night downtown celebrating a buddies birthday. Day I get home from the hospital, my partner is at my house waiting to tell me he "..no longer wishes to work together, and thinks this decision is the best for both of us.". I agreed, he hugged me as I laid in bed on pain meds and then he left.
Fast forward to two days later when I'm checking our employees work (we had an employee from the UAE working 40hr/week for us making phone calls on multi-family properties in-town) Let it be known I didn't have my phone the entire time I was in the hospital as it was stolen and wasn't allowed visitors due to COVID. So I had no way of knowing what was going on, however as I laid in the hospital bed, no thought crossed my mind that something like this would happen.
Anyways, I went to check on what all properties he found. Well, it turns out our employee found two properties owned by two seperate sellers. I then found them as "Sold" on our business website and that started to raise questions/concerns. Why wouldn't he have kept me up-to-date and told me while he hugged me good-bye? Anyways, I checked the businesses Dotloop and noticed both properties our employee found using our companies assets (Skype, expressVPN, Spokeo, Podio, Propstream, Dotloop & our Carrot website), were under my partners personal LLC and not the businesses/partnerships. When I called him out he told me "Well you weren't here based on decisions you made, so I figured I'd take all the profit from these closings. However, I guess I'll split the closings with you. ". I wish I could make this up.
Last Friday I called an attorney in town who we've closed with once before during a JV deal with another wholesaler. I hadn't heard from him in a few days and our normal attorney said she wasn't handling these closings. She (Not our normal attorney) advised me that the closing took place on October 16th. I emailed my partner yesterday and asked what was going on. This is when he gave me an ultimatum: 1. Don't come fight me for the money I owe you, let me keep it and I will let you keep the company and sign off on my side of the partnership. 2. If you do try and come at me for the money I will get my attorney involved and will take nothing less than $20,000 as my "Buy-out". I told him "Alright you can keep the money and I will no longer pursue, if I send you the documents to sign, will you actually sign?.". He never did, and I assume he has no plans on doing so.
I wish this was all made up, but this is all reality for me XD.
With the two closings approaching, under the companies LLC that he is STILL apart of is there anything I can do to protect my money? At this point I don't even care for the money he owes me, I just want him out of my life and out of my companies pockets. I want this to be over with so I can quit worrying about him taking more money from me, and get back to work!
Guess you could say my attorney didn't really give me peace of mind earlier today..
Any and all advice is welcomed, thanks!
