Hello, I am a solicitor with over 15 years experience. I will try to to help you with this. Can you just give me some idea of the time scale please, when was the company formed, when was he loan made and when was the loan repaid? Was the loan agreement in writing? Why weren't the shares re-allocated when the loan was cleared? Is the lender seeking 51% of the sale proceeds?
Ok thankyou for that. I will be busy for much of this morning but will answer you later today.
I take it that there is no written agreement for all this. It doesn't sound as if you took issue with this - 3 or so years ago- when she announced her intention to not give up her 51% of shares. and move to33% each. If it is clearly minuted that she was to give up her majority share when the money was repaid then there will be evidence that she is in breach of contract. You could take action to force her to give up the excess shares or to re-imburse you for the excess she will get as a 51% shareholder on sale. However, she would very likely argue that by not doing anything you had accepted that she should keep her shares, or that this was evidence of a further agreement between you that she could keep a 51% share holding. It is hard to asses who would prevail in a dispute of this nature but as things stand at present she will be entitled to a graeter share of sale proceeds than she should be. How much money is at stake here?
I would think that in a situation like this (where there is an oral contract and apparent breach and a fairly complex history of representations etc) and there is £170,000 involved you and the other person who may be about to be disadvantaged by the lender should seek advice from a solicitor in the orthodox face to face way. I think the amount of help which can usefully be given through this forum has already happened. You have a potential difficulty here and you need a solicitor advising you in more detail than is possible here.