Posted by Bud Branstetter on January 20, 2001 at 10:11:20:
One of the provisions of a partnership in Texas is that each partner is responsible for the acts of the other partner. The partnership does don’t have to be formal and by owning you have created a partnership. Only your attorney can advise you correctly what the ramifications are.
I have continually suggested not doing parnerships but instead, doing some type of participatory note and deed of trust.
Mr.Bronchick &/or others, what are my RIGHTS? - Posted by AnnaSalk
Posted by AnnaSalk on January 20, 2001 at 09:09:20:
As a part-owner on a property, NOT given the documents to sign as to contractor’s work/terms, do I have any rights and/or ways to remedy my situation if:
I have in fact negotiated the terms with the contractor, terms which were not even later wtitten into the contract
I have requested to see and approve the contract before work would commence
Work started without ANY approval from me and ended in major destruction, the contract I finally was given to view (in part) does not even has dates as to expected completion
Is there a way to convince my partner and/or contractor to buy me out and end this matter peacefully or do I need to file any legal papers to get out of this mess?
Anna… - Posted by Jack
Posted by Jack on January 20, 2001 at 12:18:54:
Not knowing if you’re a “general partner” or whether or not you have limited liability, I can only offer an excerpt from the TCG Business Classes. After reading it and assessing your position, I would seek legal counsel to remedy the situation. Good luck! —Jack
“Now, I’m going to touch on the partnership aspect a little more. There are distinct advantages in this form of operation, provided your temperament is suited to it (remember what I revealed about staying calm—getting along, in an earlier class), and there are distinct disadvantages that can grow into mammoth obstacles if you’re not able to get along and display patience. But here’s the basics of a partnership: In a partnership, two or more persons agree to pool certain assets, labor, or both and to operate a joint enterprise for the common good and to the profitable end for all parties concerned. You file your partnership on the same form that the assumed name certificate is filed on, except that you check the “Partnership” box instead of “Sole Proprietorship.” Also, a partnership may have a limited life. Example: (Ad Hoc) Two brick masons form a partnership to construct a masonry project; they agree to share all job expenses and profits from constructing the project; when the job is completed and all expenses are paid, and profit equally split, the partnership immediately terminates. This arrangement need not be formalized by a written contract, but nonetheless is advisable and wise to do so. The reason: You should have a formal contract that spells out yours, and your partner’s liability to the project if a future call-back problem occurs. Since both parties were equally involved in constructing the project, both should share equally in the workmanship guarantee. In addition, if a partnership continues longer than a year, the conditions of organization—the “Articles of Co-ownership”—must be set down in writing as dictated by state law. And according to business law, every partnership must have at least one general partner. He or she is the person who takes unlimited liability for the partnerships activities. But, if you form a partnership, you can specify ALL partners as “general partners” who own the business jointly and share in the profits and losses according to an agreed upon formula. If the business were to go under, all partners assets could be attached to pay the business debt obligations; this verses one single partner being the “general partner” and solely held liable. In some scam operations, the perpetrators choose one “general partner” that’s insolvent and cannot be attached because he or she has no assets. The debtors are left “holding the bag.” Then the scammers move to a new location and repeat the process. But in legitimate partnerships, they usually operate under the names of co-owners. For example: Law firms with several surnames are typical. But whatever you do under a partnership organization, make certain that you have an attorney draw up a contract that spells the duties and spells out all pertinent terms of the partnership. If you don’t, you might find you have a bigger headache than you bargained for.”
Re: what are my RIGHTS? - Posted by JPiper
Posted by JPiper on January 20, 2001 at 11:52:21:
The best advice is as Bud said below: ?See an attorney.?
It sounds like a formal written agreement was entered into by your partner and the contractor for the repair of the property. This agreement will control what happens vis-à-vis the contractor. Whether you ?told? the contractor something, or whether you wanted to approve the agreement, is irrelevant now regarding the relationship with the contractor. It will only be defined by the written agreement. If this agreement was inadequate then your solutions will probably be inadequate.
A separate matter would be the relationship between you and your partner. In general, as Bud says, partners are bound by and responsible for the acts of their partners. However, if you per chance have a written partnership agreement with your partner, and the partner breached that agreement by entering into a deal with the contractor, then perhaps you would have a claim against the partner. Only an attorney would know this though AFTER reading the document.
None of this of course FORCES the contractor to buy your interest. And none of this, in and of itself, would force your partner to buy your interest either. Disputes between partners sometimes are settled by a partition suit, which forces the sale of the property. But of course if the property is now damaged this may not be very rewarding. Of course if there did happen to be a written agreement with the partner that he breached, then perhaps you can use the possible future legal consequences to him as a lever to have him buy you out. Only an attorney will know after reviewing the situation.
There may be other factors involved here?and therefore you should speak with an attorney regarding the matter. I might add that one lesson to be learned here is that had you spoken with an attorney FIRST before this partnership/co-owner deal, perhaps you would have been better informed of the possible problems that could stem out of such an agreement, and therefore could have structured the deal differently. Don?t make the same mistake twice?.see an attorney.
JPiper