Disposing of property following a partnership split
Question from Emma updated on 1st April 2011:
Shareholder percentages me = 70% him = 30%
I am wanting to dissolve the LAQC and sever ties... he doesn't.
Unfortunately our property has dropped in value within this time so we will be realising a 'loss' of 20-30k, the difference between market value and current mortgage. We have just sold our shared home, so wanting to offset this loss against the house proceeds.
What are my options?
- can I sell my shares to another party?
- can I get an order to disolve LAQC and sell property at registered value rates?
- am I stuck in this until he agrees?
Sorry if any of the above are dumb questions! Really appreciate your thoughts
Our expert Mark Withers responded:
Sorry to hear things haven't worked out Emma. It is technically possible to sell your shares to someone else but you would need to ensure you are removed as guarantor of the debt. Unless your ex is willing to buy them though this may prove difficult.
There are provisions in the companies act designed to protect minority shareholders and these provisions can be used to place the company in liquidation to force the sale of its assets in an extreme situation where the shareholder deadlock can't be broken any other way. Despite holding 70% of the shares you typically need 75% to have the unilateral power to place the company into liquidation yourself with a special resolution.
You are really both best off if you can agree together to dispose of the property without involving the need for court ordered liquidations. Perhaps your lawyer could advise your ex of the options you have and hopefully he will come around to following the path of least resistance and working with you to sell it.
Mark Withers and his team at Withers Tsang & Co specialise in advising on property related transactions, valuation and restructure services and tax planning.
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