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Buachaill, Barrister
Category: Law
Satisfied Customers: 10953
Experience:  Barrister 17 years experience
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Have a question regarding a business agreement. Over a year

Customer Question

Have a question regarding a business agreement.
Over a year ago a company was set up, the three of us were in full time employment so we set it up in a friends name. We then agreed we would all leave our jobs at different intervals, one went first then the second was force to by employer. These two have now been directores and have equal shares. We have all been in correspondence constantly with the companies email we all have the third me has also helped or jobs out of hour and weekends plus help implement all procedures. I have never taken a penny as we agreed verbally we was all equal partners and we wouldn't get any money untill we was all over. Now I have moved over to the company they have placed me on paye and want to allocate me five percent only. The only official paperwork I have confirming we are all directors is a loan we acquired from a friend signed by all the directors to pay back in due course. Am I screwed?
Submitted: 2 years ago.
Category: Law
Expert:  Buachaill replied 2 years ago.
1. Firstly, a partnership does not have to be in writing in order for one to exist. The terms of any partnership are based on the 1895 Partnership Act unless they have been committed to writing. Here, you have the course of correspondence by email between you all up to the creation of the partnership and the evidence of the loan to show you were a one third shareholder throughout, until your two partners decided to cut you out. So it seems to me you have sufficient evidence to show you are a one third partner and not a 5% partner. So you should sue to enforce the one third partnership agreement. It is not a pre-requirement that you be a director in order that you be a full one third partner. In retrospect, you were foolish not to become a partner from the outset. However, now you need to protect your share and sue to enforce it.