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Alex J.
Alex J., Solicitor
Category: Law
Satisfied Customers: 3695
Experience:  Solicitors 2 years plus PQE
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I sold my business last November. I received a third of the

Resolved Question:

I sold my business last November. I received a third of the sale value up front with the rest to be paid over 3 years monthly. After 7 monthly payments, I am being told the monthly turnover in the business doesn't cover my payments. I am worried I will just stop being paid. Is there anything I can do legally to challenge the guy who bought my business if this happens?
Submitted: 1 year ago.
Category: Law
Expert:  Alex J. replied 1 year ago.

Hi, Thank you for your question and welcome. My name is ***** ***** I will assist you. Did the individual who purchased the business by it as a limited company? Do you have a contract?

Customer: replied 1 year ago.
he has 4 companies and used one of his limited companies to buy my business.
Customer: replied 1 year ago.
I signed a contract, but there was nothing in the contract about performance being aligned with monthly business payments. It wasn't a huge sale - 72.5K
Expert:  Alex J. replied 1 year ago.

Thank you. If the purchase price was not conditional on performance and he is refusing to pay you, quite simply you can sue him to recover the money. How much more are you owed? Kind regards AJ

Customer: replied 1 year ago.
He has paid about 50% of total. I understand I can sue him if company still in operation, but main worry is - is there any protection or right to pursue the debt if he winds up the ltd company that bought my company and continues to trade under one or all of his other ltd companies?
Expert:  Alex J. replied 1 year ago.

Hi, Thank you. Was your contract not with him personally? Did he buy the shares in your company or the assets of your company? Kind regards AJ

Customer: replied 1 year ago.
No, as i said above he has 4 companies and used one of them to buy my company - so the contract was with one of his ltd companies, which i presume means he can limit his liabilities through and fold if he wants even if he hasn't paid me all the money owed. He bought the company lock stock and barrel - all shares and assets.
Expert:  Alex J. replied 1 year ago.

Hi, Thank you. Yes you can only pursue his limited company that purchased the shares. However this company owns the company you sold so it has assets. In theory he could just put it into liquidation, but this may not be in his interest if the company has assets. Has he said he wont pay at all and wants the money written off? Kind regards AJ

Customer: replied 1 year ago.
No but I can see it coming. So basically if he folds the Ltd company that bought mine that is the end of any payments to me - would I get notification anywhere that this is happening so I could grab some assets back - like computers, furniture and other office equipment? I think it is wrong he can continue to trade under one of his other companies (all have same name but with Group or name of region after it). I was hoping there was a legal way to recover full price of sale if he folds the one ltd company but that will be why he did it.
Expert:  Alex J. replied 1 year ago.

Hi thank you. The legal way to recover the money in liquidation is to make a claim in the liquidation. If he has been diverting money from the company for his own gain knowing it is insolvent then you may be able to sue him personally. You need to start the process by at least commencing a court claim if the money remains unpaid.

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