Business and Contract Disputes Creating a Serious Problem?
Regardless of whether you own an business with a family member, a friend, or hold a position on the board of a large corporation, you know that business and contract disputes can often times cause major problems. Specifically, business owners that face contract disputes with other companies and even more so, between their own ownership structure. For instance, a business contract dispute may arise between two or more partners, when one partner fails to fulfill his responsibilities. Often times business owners do not anticipate disputes until they arise. As a result, income might be lost due to contract breaches; ownership might be in the limbo due to outside lawsuits and claims; and tensions amongst business owners may rise. Lastly, a California business that is facing a lawsuit must be represented by an attorney. As such, a business owner cannot represent themselves in pro per.
Each General Partner Has an Equal Right to Participate in The Management and Control of The Business
As a matter of course, each general partner has an equal right to take part in the management and control of the business. Disputes in the ordinary course of business are decided by a majority vote of the partners. While, disputes or disagreements of extraordinary matters or any amendments to the partnership agreement require the consent of all partners. Be that as it may, in an partnership of any size the partnership agreement will provide for certain electees to manage the partnership along the lines of a company board.
Generally, unless otherwise provided in the partnership agreement, no one can become a partner of the business partnership without the consent of all partners. However, an existing partner may transfer partnership interests and assign his share of the profits and losses and right to receive distributions.
Business Dissolution Process
Businesses can dissolve the entire or part of a company by engaging in the “winding up” or “dissolution” process. The winding up process is subject to a strict legal rights of its partners, as well as creditors and claimants. Terminating a California business, often times involves a “liquidation process”, where the company begins to wind-up affairs, pay debts, and dissolve. Furthermore, there are special procedures for dissolving corporations that are undergoing Chapter 7 bankruptcy, or have disposed of all assets, and not conducted any business for the last five years.
Winding-Up a California Corporation
During the winding-up process is subject to strict legal rights of the shareholders, thus must be both “just and equitable” Thus, to ensure that all issues are considered and addressed appropriately, its is recommend to that you consult with California corporate attorney prior to submitting termination documents to the California Secretary of State. If you wish to dissolve or terminate your corporation, we invite you to contact our Glendale business corporate lawyers and discuss the proper legal steps you must take in order to property terminate your California corporation.
Under California’s General Corporation law (“GCL”) shareholders holding shares with at least 50 percent of the voting power can voluntary elect to dissolve the corporation. It is important that you review your articles of incorporation and bylaws, and speak to a experienced Glendale business lawyer, to ensure that you are following the proper dissolution procedures specifically for your corporation.
If a all members have approved that dissolution, your corporation continues to exist only for the purpose of taking care of final matters. As such, all board members have full power to wind up and settle the affairs of the corporation, including paying all known corporation debts and liabilities, and then distributing remaining assets, if any, to persons entitled to those assets.
This content is intended for educational purposes only. KAASS LAW is authorized to practice law in California. The above content is intended for California residents only. This content provides only general information, which may or may not reflect current legal developments. KAASS LAW expressly disclaims all liability in respect to actions taken or not taken based on any of the contents of this website. The above content DOES NOT create an attorney-client relationship. KAASS LAW does not represent you unless you have expressly retained KAASS LAW in person at the KAASS LAW office.
KAASS LAW helps clients in: Los Angeles, Burbank, Hollywood, Glendale, Van Nuys, North Hollywood, Studio City, Highland Park, Eagle Rock, Sunland, Tujunga, Sylmar, La Crescenta, La Canada, Beverly Hills, Westwood, Santa Monica, Brentwood. Pacoima, Montebello, Commerce, Alhambra, Downey, Bell, Maywood, Walnut Park, Vernon, Lynwood, Echo Park, Silverlake, Mission Hills, Northridge, North Hills, Porter Ranch, Chatsworth, Reseda, San Diego, La Jolla, El Cajon, Chula Vista, Del Mar