Four years ago my friend asked me to open a gymnasium in the building which belongs to his father. We have an agreement, without any formal proceeding about rent and there is no time limit mentioned for the partnership.the firm is not registered We recovered only the initial investment after four years and now he want to through me out off the business by offering me the current value of the setup, which would be around half of the initial investment plus all other upgradations and maintenance. This would be big loss to me. Please guide me what i can do. Thanks
Sir does your partnership deed mentions about the termination of the partnership is there any clause of same.
See if there is any dispute among the partners the firm can be dissolved he can do that you both disputing among yourself cannot run the business.
In case.the firm dissolves the assets and liabilities of it are divided in that way you receive the half only..
So better to ask him for some compensation along with value of assets and leave it amicable rather then struggling in court.
these kind of things happen in the business where the clash of leadership over the functional responsibilty or over investment. As per law such things are resolved by means of arbitration or by associating counsel to resolve such issues.
You can reject your friend offer as you woukd be at a loss if you retire as partner from the firm
2) you can refer disputes to arbitration if there is arbitration clause in your contract
3) ask your friend to pay you amount t invested by you
your friend has to pay you for your exit on basis of the agreed profit and loss ratio agreed in your agreement and also refund the capital invested by you
there is no point continuing with the partnership as there is bitterness between the two partners
Dear Client,
IS there any clause about profit sharing in partnership deed ?
Is this executed on stamp paper or plain paper ?
Any dissolution/termination clause ?
1. IF the Partnership Deed is NOT registered, THEN it is not legally enforceable in court for any settlement. Hence try to settle amicably and sort out the differences.
Keep Smiling .... Hemant Agarwal
I think there is no choice left then to leave the business because even if you don't agree to leave the business he will get out of partnership and the partnership firm will be dissolved and in that case you have to sell out all the equipments whether to him or to any outside party to realise the amount to be divided between both of you as there is no agreement on the property so you cannot forced to stay there with your equipment and business
It is advisable that you have to take a decision which is a mutually agreed between both of you to go out of this business peacefully
In the absence of any formal legally valid partnership deed or agreement neither of you can initiate any legal steps against each other.
the solution before is that you both should reconcile the difference and arrive at an amicable settlement.
if that is not possible then you issue a legal notice to him on the basis of oral agreement between you both and invite him for an amicable settlement of the issue or to face the legal consequences.
this notice would serve the purpose of some correspondence or evidence between both for any future litigation.
Hello,
Sen a legal notice to him and thereafter if he does not mend his ways file a police complaint and civil suit against him.
Collect some evidences wherein he admits to the fact that you have invested initially and that you were one of the partner in the case.
Regards
