• In LLP protecting interest of a Partner

Sir,
     I am base at Vadodara, Gujarat. Recently I got an offer from one of my friend toenetr into LLP. They are engaged in metal industry for more than 4 decades. They have got a job work in a company for 5yrs contract. They want me to join as a Financer in this partnership. 
* Contract is balloted to my friend's metal company based on their credentials and experience in this field. Contract is already signed and my friend is an authorised signatory to deal with company and communication address is his office address.
* He said we will form a new LLP and we will get a new pan card and open a new account and we will give this account details to company for payment. ( he agreed to me one of the signing authority)
Now my query is
* Company don't even know me and this is our own mutual arrangement for carry out the contract. Suppose after six months my friend changes his mind and tell company to change payment account, then how I can protect my interest and Investment.

Please answer my query as soon as possible.

Regrds,
Vikas
Asked 3 years ago in Business Law from Vadodara, Gujarat
you have to engage a local lawyer to protect your interests . dont part with your hard earned money unless legalities are clear
Ajay Sethi
Advocate, Mumbai
26123 Answers
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Do not join as a financer unless the partnership deed and other relevant documents are perused by your lawyer and he gives a finding as to the compliance of the legal framework.
Ashish Davessar
Advocate, Jaipur
19168 Answers
484 Consultations
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if  your partners want to misappropriate funds  they will find ways of doing it . in case they do  so you can file case of cheating , criminal breach of trust against them . you must insist on accounts being audited . all payments / receipts by cheques only . get all agreement vetted by lawyer
Ajay Sethi
Advocate, Mumbai
26123 Answers
1420 Consultations
5.0 on 5.0
You must enter into a contract with them which specifies in no uncertain terms the rights and duties of you and the other partners as your rights in the event of a financial misdemeanor will be governed by such contract. This is what I will do.
Ashish Davessar
Advocate, Jaipur
19168 Answers
484 Consultations
5.0 on 5.0
vikas when you are spending lakhs of rupees in investing in the project it is better you consult a local lawyer pay his consultation charges and then decide your next course of action. it is better you mention all the clauses in partnership deed itself . 
an MoU  is NOT designed to be legally binding. An MoU or as it is also called, a Letter of Intent or Heads of Agreement, are usually designed to note down the pertinent commercial terms for further review and are Subject to Contract. The idea is that they are some comfort to the parties as to what the main commercial agreement is going to be before the parties have got to the formal contract stage
The enforceability of the document will depend upon the exact language of the same. Labeling a document "MOU". "letter agreement", "letter of intent" will not, in and of itself, make a document binding or non binding.
Ajay Sethi
Advocate, Mumbai
26123 Answers
1420 Consultations
5.0 on 5.0
Have you not engaged a lawyer for the purposes of drafting and registration? If you have engaged one then has he not answered these queries?

Whether or not a MOU is legally binding has to be decided with reference to the legal terminology incorporated therein and not the nomenclature of the document. 

Consult a lawyer personally by paying his consultancy charges to get a clear picture.
Ashish Davessar
Advocate, Jaipur
19168 Answers
484 Consultations
5.0 on 5.0
we have already advised you at length . your  lawyer must have said MOU is binding based on clauses incorporated in it .
Ajay Sethi
Advocate, Mumbai
26123 Answers
1420 Consultations
5.0 on 5.0
We have already advised you sufficiently. Go along with the advice of your lawyer now.
Ashish Davessar
Advocate, Jaipur
19168 Answers
484 Consultations
5.0 on 5.0
thanks for your appreciation
Ajay Sethi
Advocate, Mumbai
26123 Answers
1420 Consultations
5.0 on 5.0
Thank you for your appreciation.
Ashish Davessar
Advocate, Jaipur
19168 Answers
484 Consultations
5.0 on 5.0

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