Page 1 of 2 12 LastLast
Results 1 to 10 of 15

Thread: CC Members no longer getting along

  1. #1
    Bronze Member Beancounter's Avatar
    Join Date
    Oct 2011
    Location
    Pretoria
    Posts
    118
    Thanks
    19
    Thanked 29 Times in 24 Posts

    CC Members no longer getting along

    I have perused the CC Act but failed to find a solution to what happens when the members of a CC no longer get along and one wants out. The CC is basically insolvent so from the CC no distributions can be made to any members without contravening the Act.

    The member who wants to leave however insists on R50 000 buy-out so that he can get out of the CC but the other members cannot afford to pay him. Can the remaining members offer any reason why he should sign the CK2 without paying him anything?

    Is this one of those cases where the members are going to have to approach the Master of the High Court for a decision on the matter or does the Act provide for instances like this?

  2. #2
    Diamond Member Justloadit's Avatar
    Join Date
    Nov 2010
    Location
    Johannesburg
    Posts
    2,671
    Thanks
    88
    Thanked 544 Times in 460 Posts
    Blog Entries
    1
    Is the company worth R50K? Probably not, so why do you have to pay him to get out.
    Liquidate, and no one gets anything.
    Victor - Knowledge is a blessing or a curse, your current circumstances make you decide!
    Solar and LED lighting solutions - www.microsolve.co.za

  3. #3
    Site Caretaker Dave A's Avatar
    Join Date
    May 2006
    Location
    Durban, South Africa
    Posts
    20,980
    Thanks
    3,055
    Thanked 2,463 Times in 2,068 Posts
    Blog Entries
    12
    Quote Originally Posted by Justloadit View Post
    Is the company worth R50K? Probably not, so why do you have to pay him to get out.
    Liquidate, and no one gets anything.
    +1

    Normally a good starting point in negotiations
    The trouble with opportunity is it normally comes dressed up as work.

  4. #4
    Bronze Member Beancounter's Avatar
    Join Date
    Oct 2011
    Location
    Pretoria
    Posts
    118
    Thanks
    19
    Thanked 29 Times in 24 Posts
    Good idea Justloadit, only problem is, the remaining members are father and son and the dad stands to lose his house if the son doesn't carry on with the CC and try and make a success of it to repay his dad's loan.

  5. #5
    Gold Member Singhms's Avatar
    Join Date
    Oct 2008
    Location
    Pretoria (National)
    Posts
    977
    Thanks
    161
    Thanked 52 Times in 48 Posts
    Are the only 2 members the dad & son. Also was any membership agreement signed between the members?
    Visit our online store SINGHMS RETAIL and sign up to receive a 10% discount off your first purchase.
    Follow us on our facebook page SINGHMS RETAIL FACEBOOK for instant updates.
    New products and discounts added daily.

  6. #6
    Bronze Member Beancounter's Avatar
    Join Date
    Oct 2011
    Location
    Pretoria
    Posts
    118
    Thanks
    19
    Thanked 29 Times in 24 Posts
    They are 3 members, father and 2 sons. One son wants out, the other son wants to carry on and try and save the business to repay the dad's loan.

    No membership agreement as far as I'm aware of, so we have to rely on the Act.

  7. #7
    Site Caretaker Dave A's Avatar
    Join Date
    May 2006
    Location
    Durban, South Africa
    Posts
    20,980
    Thanks
    3,055
    Thanked 2,463 Times in 2,068 Posts
    Blog Entries
    12
    Lovely - all in the family to boot

    I take it you're trying to avoid holding a meeting and achieving what you want in a strategic sequence of resolutions. 2 out of three members does make a voting majority.

    EDIT: I just took a quick poll in my office - everyone reckons the one who wants to bail should be paying in to get out!
    The trouble with opportunity is it normally comes dressed up as work.

  8. #8
    Bronze Member Beancounter's Avatar
    Join Date
    Oct 2011
    Location
    Pretoria
    Posts
    118
    Thanks
    19
    Thanked 29 Times in 24 Posts

    Lightbulb

    Hehe! I like the way the people in your office think!

  9. #9
    Suspended
    Join Date
    Oct 2007
    Posts
    2,346
    Thanks
    0
    Thanked 254 Times in 209 Posts
    2 things i have learnt from bussiness in the couple of years i have been operating...dont let family get involved in your bussiness especially not your wife(personal experience)...and even kids if you can help it...and the other dont get involved with partners...the last partnership i have been watching finally broke down after 27 years and now there iis just bad feeling amongst all the members...as soon as the sons got involved so the relationship between the partners started to fall apart...now the sons are busy destroying whats left of the comapnies faster than they can make money.

    this is just form my experiences and what i have seen in the couple of years i have been in bussiness...father work hard to make their companies grow...drive the same car for years...save...save ...save ...save...save...save...as soon as the wife or kids get their hands on the comapny or money they spend it faster than the interest can be earned on the savings or the company can turnover...it is just so sad...

    one company i worked with...the father didnt even own a motor vehicle...yet he was (being the key word) doing so well...had enough money to build his family houses worth millions and paid cash...while building one of the houses i noticed the son driving the latest top of the range car...within a couple of years the company went backrupt...it just could nt keep up with the lifestyles...he lost everything he spent his life building.

  10. #10
    Site Caretaker Dave A's Avatar
    Join Date
    May 2006
    Location
    Durban, South Africa
    Posts
    20,980
    Thanks
    3,055
    Thanked 2,463 Times in 2,068 Posts
    Blog Entries
    12
    Been thinking about this one. Taking it to The Master to resolve might produce an unintended result (order to liquidate).

    The current scrap seems to be a dilemma in two parts, really.

    Is everyone agreed that the one member should leave?

    If yes, all that is left is to agree the payout (or pay-in )

    If the members could be pursuaded to accept an independant valuation as a reasonable solution to determining a fair value for the interest, you might just pull this one through without a lingering family fued...
    The trouble with opportunity is it normally comes dressed up as work.

Page 1 of 2 12 LastLast

Similar Threads

  1. AVG no longer our friend?
    By tec0 in forum Technology Forum
    Replies: 36
    Last Post: 11-Nov-10, 06:38 PM
  2. Home loan approval may take longer
    By duncan drennan in forum National Credit Act Forum
    Replies: 6
    Last Post: 14-Apr-09, 12:08 PM
  3. How much longer is this racial incitement going to go unchallenged?
    By Dave A in forum South African Politics Forum
    Replies: 0
    Last Post: 11-Oct-07, 10:05 PM

Did you like this article? Share it with your favourite social network.

Did you like this article? Share it with your favourite social network.

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •