Removal of cc member

[Dave A]

So let's cut to the chase with a clear suggestion then?

Based on what I've read so far, an option might be to buy the cc that you're "borrowing" at the moment with the ownership structure you want, and let the new cc die a death. But there might be an issue not raised yet that doesn't allow that option.

Here are some previous dicussions involving getting rid of members of a cc.

http://www.theforumsa.co.za/forums/s...s-of-a-CC-Help
http://www.theforumsa.co.za/forums/s...-CC-Membership
http://www.theforumsa.co.za/forums/s...-members-of-CC
http://www.theforumsa.co.za/forums/s...-cc-gracefully
http://www.theforumsa.co.za/forums/s...ny-the-process
http://www.theforumsa.co.za/forums/s...-Advice-Please

As you will see, generally the threads become very much shaped by the context of the person with the problem. There is no cookie cutter one-size-fits-all solution.

So, is buying the "borrowed" cc an option?
Do you need a BEE partner for this contract that seems to be the cornerstone of this rocky relationship?
How binding are the terms of the gift?
Can you just walk away?

[BusFact]

First answer Dave's questions, then:

If you are not trading through this new company, why are you providing minority with all this income and support? What would happen if you just stopped doing so?

He is not an employee so you can't fire him. He is a shareholder so will have to be bought out if you want the company. You may pay R1 or a lot more, but that is between you and minority to decide. The company does have value to you otherwise it wouldn't be stressing you so much. Paying him out might upset you now but could be a better and cleaner long term solution.

[MinnieMouse]

Dave -
Buying the CC is not an option . I suggested this a while ago and was blown out the water as it is a designated CC name for a field about to explode into SA. We do not wish to have a BEE partner nor any partner further from this. A lesson well learnt. There were no terms or contracts or agreements Documented with regard to it being a gift or anything for that matter. This contract is of major value and also our stepping stone to following in the steps of my partners father to become industry leaders.

BusFact-
Because he is set to be the member and neither of them are listed on the borrowed cc as members, they have equal drawings. We are looking to force him out the house and reposess the vehicle he has bought from our grandmother that he has made 1/3 of the payments stipulated in the agreement. The census is that if we give him enough rope, he'll hang himself.

The next turn of events is that he has a common interest business that he is registered to, and his 'friend' that he spends his waking hours with has a field related business, therefore showing that he could be trading underhandedly.

[Justloadit]

The next turn of events is that he has a common interest business that he is registered to, and his 'friend' that he spends his waking hours with has a field related business, therefore showing that he could be trading underhandedly.

But there is no agreement, so whether he does this is going to cost money to fight in court. If the company was a PTY, the fiduciary duties of a director would apply, but a member of a CC does not have this, I may wrong and stand to be corrected.

[Dave A]

I suggest disclosure between partners of possible conflicts of interest is pretty much a norm, regardless of whether we're talking a cc, pty or even an unincorporated partnership. Nondisclosure (if that's what has happened here) certainly is fertile ground for a scrap.

Strategically my concern would revolve around the amendment of the SLA as this involves an active move by the client. If the official provider needs to be amended to a new entity, and that amendment gets contested... Things could go pear-shaped.