Business Contract

[Intrate]

If I have a business contract with a partner and my partner has a debt that he or she owes (and the debt was long before starting a business with my partner, so I and the business itself have nothing to do the debt), can the debt collector pull money out of our business account when that is also my money?

 

[quincy]

If I have a business contract with a partner and my partner has a debt that he or she owes (and the debt was long before starting a business with my partner, so I and the business itself have nothing to do the debt), can the debt collector pull money out of our business account when that is also my money?

It depends on the type of business contract you have with your partner. You can have an attorney in your area personally review your business arrangement to tell you better.

 

[latigo]

If I have a business contract with a partner and my partner has a debt that he or she owes (and the debt was long before starting a business with my partner, so I and the business itself have nothing to do the debt), can the debt collector pull money out of our business account when that is also my money?

(Aside from your specific question.)

The combination of your words "business contract" and "partner" raises red flags, friend. Bright, iridescent red flags!

Because in no way should you be in no partnership! And a business enterprise with two or more participating individuals or entities can readily become a partnership by operation of law (imputed) whether or not the members intended it so.

Why is it not recommended? Because it creates unwanted reciprocal agency. Meaning that each partner can independently legally bind not only the partnership but the individual partners as well. Including not just contractually, but civil liability for tortuous conduct. Like running over a pedestrian while on company business.

So heed Q's good advice and get with your attorney, post haste - if not muy pronto.

 

[Intrate]

(Aside from your specific question.)

The combination of your words "business contract" and "partner" raises red flags, friend. Bright, iridescent red flags!

Because in no way should you be in no partnership! And a business enterprise with two or more participating individuals or entities can readily become a partnership by operation of law (imputed) whether or not the members intended it so.

Why is it not recommended? Because it creates unwanted reciprocal agency. Meaning that each partner can independently legally bind not only the partnership but the individual partners as well. Including not just contractually, but civil liability for tortuous conduct. Like running over a pedestrian while on company business.

So heed Q's good advice and get with your attorney, post haste - if not muy pronto.

What if it is a partnership agreement for my family business while my parents hold 80% of the business and I hold 20%?

 

[quincy]

What if it is a partnership agreement for my family business while my parents hold 80% of the business and I hold 20%?

Intrate, what sort of debts are we talking about here?

 

[Intrate]

Intrate, what sort of debts are we talking about here?

I'm guessing a loan as that is what it looks like.

 

[quincy]

I'm guessing a loan as that is what it looks like.

You guess it is a loan but you are not sure? You should know the particulars.

If you are having to "guess" about the kind of debt your partner has, you really need to quiz your partner and then sit down for a serious talk with an attorney in your area. Depending on the facts of the debt or debts, you may have placed own money and assets at risk with this business partnership.