I have a written contract with a business partner. We are dissolving the partnership. He is keeping the business open.

Asked 8 months ago - Chula Vista, CA

One customer owes us $5000 dollars for jobs we did for him. My partner did not get documentation on the jobs on this customer because he knew him for a long time . My partner said that he always pays and he was the one that gave him credit to this customer ( let him pay later). Its been over a year and the customer hasn't paid. Half of the money belongs to me. The customer has a business of his own and he keeps telling my partner that he will pay but up to today he hasn't.
What can I do to get my money (half of the $5000 dollars)? Sue the customer? Sue my partner ? or sue both?

Attorney answers (6)

  1. Michael Charles Doland

    Contributor Level 20

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    Answered . Reading between the lines you probably have a general partnership without an agreement. The money is owed to the partnership, and the partnership should sue the customer in small claims court. Either partner can bring the claim.

    I won't be surprised to learn that your partner was paid but not you.

    The above is general legal and business analysis. It is not "legal advice" but analysis, and different lawyers may... more
  2. Timothy George Kerrigan

    Contributor Level 15

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    Answered . A this point in time, the right to the money is owned by the partnership. Either partner may bring suit in the same of the partnership while it exists. Do not dissolve the partnership until these matters are straightened out.

    No information provided in response to these questions can be relied upon in any way without further personally... more
  3. Samuel Watson Eastman

    Pro

    Contributor Level 14

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    Answered . Based on the facts you have provided, it does not appear that there would be a cause of action against your business partner for making a poor business decision. Although I'm not familiar with the agreement you have with your business partner, but it does not appear that his poor judgement would be enough for you to sue him. It may be somewhat problematic to your recovery that there was no written agreement in place with the customer who has failed to pay, but depending on the facts, you may be able to successfully recover. Due to the amount in dispute, the proper venue to pursue your claim would likely be small claims court. I have provided a link below to a guide for filing claims in small claims court in your area below, so please consult that guide for more information.

    This advice is for INFORMATIONAL PURPOSES only and should not be relied upon as legal advice. No attorney-client... more
  4. A Melissa Johnson

    Contributor Level 15

    4

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    Answered . First, you should not leave the partnership until you resolve the remaining issues with your partner. Second, as a partner, you have the right to sue a third party for money owed to the partnership. Third, whether you have any remedies against your partner depends, in part, on the terms and conditions of your partnership agreement and the nature of the acts of your business partner.

    You might seriously consider contacting a local attorney to help you through the process of disassociating yourself from the partnership.

  5. Johnathan Michel Razbannia

    Contributor Level 8

    3

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    Answered . This is a small claims matter and either partner may sue the customer to collect.

    No attorney / client relationship established. The answer is for discussion and general information only. The... more
  6. Armen Kiramijyan

    Pro

    Contributor Level 4

    1

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    Answered . What you should take away is sometimes client's are going to skip the bill. To this effect, you should think about how to prevent this going forward. Cash is king, but it is often not available. The most important asset is the client, try to sit down with your partner and establish and stick to procedures in picking the right ones.

    Before filing a lawsuit you may also consider utilizing the services of a collection attorney. There are respectable one's here on help that you may research into.

    This content is intended for educational purposes only. Armen Kiramijyan is authorized to practice law in... more

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