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I purchased a storage rental business with my business partner 2 years ago. He passed away shortly after and left his ownership to his son. The son wants to sell his 50% but is demanding far more than the paid for price and way more than market value. He is saying if I don’t pay his price he will have a family member buy him out that I have no interest in being in business with. What are my rights concerning this matter?
A business transactions attorney can analyze the specifics of your business and the proposed/threatened sale and provide you with the most relevant options. If you and your former business partner had a formal agreement, such as a partnership agreement, and that agreement outlines the process and requirements for buying out the other partner’s share, then that document will probably control and you and the son will have to follow it. There’s also a possibility that an informal agreement, if you have evidence of it, could limit how the son can dispose of his share. If you don’t have an agreement, or it’s silent on this issue, then you probably cannot compel the son to sell you his share for market price. Like any commodity, the son is able to price his share however he wantsâ€”neither you nor anyone else has to buy it at his price. Most likely, the son feels that full ownership has additional value to you, and that you may be willing to pay for that value. Although consulting a business transactions attorney may provide you with more insight as to your options, this may be a situation where hard negotiation is your best option.