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ownership of corporation (involving husband/wife)

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hydra

Junior Member
I would like to ask the forum's expertise/help on the following matter:

My father registered a corporation (under the laws of Michigan) several years ago. On the Articles of Incorporation, it lists only his name under Article V (names/addresses of the incorporators). There is no mention of my mother's name on that document.

A few years ago, my father's corporation sold a minority stake of his corporation to another company. Both my father and mother signed those documents (e.g. stock certificates) related to selling off a minority stake of the company. In other words, someone looking at those documents would perhaps be led to believe my mother owns an equal stake in the company as my father does.

So my question is: legally speaking, does my mother actually own any part of the corporation my father created? Or was her signature on the stock certificates completely unnecessary (and perhaps even inappropriate)? To clarify, my question is under the presumption they remain married.

If I left out important pieces of info needed to answer my question, please let me know and I will try to answer them. Thank you.
 


tranquility

Senior Member
While mom doesn't really "own" anything, she has rights to it. How can this be? Ownership is just a collection of rights. I don't think mom's rights have ripened (without death or divorce) to the point she has any management or sale rights, but she does have some rights. No one can say if mom has "ownership" of the corporation. It would depend on which ownership right you are thinking of.

Rather than ask some hypothetical on the law, how about the reality of what you are asking?
 

hydra

Junior Member
While mom doesn't really "own" anything, she has rights to it. How can this be? Ownership is just a collection of rights. I don't think mom's rights have ripened (without death or divorce) to the point she has any management or sale rights, but she does have some rights. No one can say if mom has "ownership" of the corporation. It would depend on which ownership right you are thinking of.

Rather than ask some hypothetical on the law, how about the reality of what you are asking?
Sorry, I wasnt trying to be cryptic. To rephrase, if someone wishes to buy a stake (minority or majority) in my father's company or in the extreme case, buyout my father's company in its entirety, would my mother's signature on those transfer of ownership documents (stock certificates) be necessary from a legal standpoint?
 

tranquility

Senior Member
Sorry, I wasnt trying to be cryptic. To rephrase, if someone wishes to buy a stake (minority or majority) in my father's company or in the extreme case, buyout my father's company in its entirety, would my mother's signature on those transfer of ownership documents (stock certificates) be necessary from a legal standpoint?
Again, you hide the ball. What is happening?

Even as it stands with the question, necessary? Again, it depends. Can dad sell the stock without mom's signature? Probably. Would the buyer be able to feel fairly secure the deal is irrevocable just because mom wanted out? Probably. Would mom have rights against dad? Maybe.
 

LdiJ

Senior Member
I would like to ask the forum's expertise/help on the following matter:

My father registered a corporation (under the laws of Michigan) several years ago. On the Articles of Incorporation, it lists only his name under Article V (names/addresses of the incorporators). There is no mention of my mother's name on that document.

A few years ago, my father's corporation sold a minority stake of his corporation to another company. Both my father and mother signed those documents (e.g. stock certificates) related to selling off a minority stake of the company. In other words, someone looking at those documents would perhaps be led to believe my mother owns an equal stake in the company as my father does.

So my question is: legally speaking, does my mother actually own any part of the corporation my father created? Or was her signature on the stock certificates completely unnecessary (and perhaps even inappropriate)? To clarify, my question is under the presumption they remain married.

If I left out important pieces of info needed to answer my question, please let me know and I will try to answer them. Thank you.
Your mother would have a stake in the company because its a marital asset. That may by why she had to sign.
 

hydra

Junior Member
Again, you hide the ball. What is happening?
My mother mixes business with personal life. They recently got into a big (personal) fight and has threatened to resign her position in the company. My father in fact wishes my mother never worked for his company in the first place but that's another story. Now he wants to regain control of his company from a legal standpoint. There is currently a possible acquisition deal in the works. It is still in the tentative stages as no LOI has been signed. He wants to know how he can legally proceed if he decides to sell his company even if my mother does not wish it.

Even as it stands with the question, necessary? Again, it depends.
Can you elaborate? Depends on?

Can dad sell the stock without mom's signature? Probably. Would the buyer be able to feel fairly secure the deal is irrevocable just because mom wanted out? Probably. Would mom have rights against dad? Maybe.
For my reference, may you tell me your professional background (e.g. lawyer)?
 

hydra

Junior Member
Your mother would have a stake in the company because its a marital asset. That may by why she had to sign.
They are currently married. However her name is not on any documents related to the registration of the corporation.

Does this mean if my father wishes to sell either part of all of the company, all related documents for such a transfer of ownership must also be signed by my mother (even if her name is not on any legal document related to ownership of the corporation)?
 

tranquility

Senior Member
He wants to know how he can legally proceed if he decides to sell his company even if my mother does not wish it.
By mixing things so much, I suspect you will need an attorney to review the actual facts. When I see:
regain control of his company
I suspect he won't just be able to sign and make things sold. Not only will the buyer balk, but also there may be a transfer of managerial rights to wife.

For my reference, may you tell me your professional background (e.g. lawyer)?
I claim nothing more than that I am a consumer who has faced similar legal issues. Just like the note at the bottom of the page says.
 

hydra

Junior Member
That wasn't the question I asked ;)

Where do your parents reside?
Sorry about that. They live/work overseas in China. The corporation is registered in Michigan and acts as a shell company. There is a China subsidiary that operates as the actual base of operations for manufacturing as well as for sales/marketing.
 

Zigner

Senior Member, Non-Attorney
Sorry about that. They live/work overseas in China. The corporation is registered in Michigan and acts as a shell company. There is a China subsidiary that operates as the actual base of operations for manufacturing as well as for sales/marketing.
This site is for US Law Only. Your questions are related to the way in which Chinese law would order the assets to be split...and nobody here is versed in Chinese law at all.
 

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