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Dimitry K., Esq.
Dimitry K., Esq., Attorney
Category: Business Law
Satisfied Customers: 41221
Experience:  Run my own successful business/contract law practice.
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is it legal for a hedge fund to not pay commission when the

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is it legal for a hedge fund to not pay commission when the reps spouse opens an account?
Thank you for your question.

If the representative accounts are opened without a commission, then yes. The reason is that a spousal account is deemed equivalent to a representative account, which by definition is not entitled to a commission.

Good luck.

Edited by Dimitry Alexander Kaplun on 11/2/2010 at 5:59 AM EST
Customer: replied 6 years ago.
What if there is nothing definitive in the contract regarding rep accounts? Can this be modified through addendum and who is commonly excluded children and spouses?
Thank you for your follow-up.

If there is nothing quite definitive, it is up to the company to set limitations. It can most definitely be modified by a company addendum. Usually spouses are excluded, but children, if they are adults, are not (as they technically have their own funds, while minor funds are under trust).

Good luck.

Edited by Dimitry Alexander Kaplun on 11/2/2010 at 6:13 AM EST
Customer: replied 6 years ago.
Last one I promise and thank you for your quick responses.

What about siblings, parents etc.? Is that usually treated like adult children?
You are most welcome. Happy to help!

That is correct, siblings and parents are also treated separately, as they are separate individuals with separate funds. Spouses share funds, as those funds are considered jointly owned under state law. Parental or sibling funds are not jointly owned, as they are only held by that specific parent or that specific sibling (and their spouse, if applicable).

Good luck.

Edited by Dimitry Alexander Kaplun on 11/2/2010 at 6:21 AM EST
Dimitry K., Esq. and 6 other Business Law Specialists are ready to help you
Customer: replied 6 years ago.
does it show that i clicked accept answer on your side? I just did but the button is still active
No, it does not--I do not see that an accept was recorded. Could you try again, please?
Customer: replied 6 years ago.
Dimitry,

For clairification...

If a rep opens an account with their spouse, and there is no definitive exclusion in their contract for commissions being paid on accounts where the rep owns the funds directly or jointly via a spouse, then the company must pay for that period, even if the company later adds an addendum to the contract excluding those funds. Further, could the addendum be retroactive?
Thank you for your patience.

That is correct--if there is currently no condition in the company that forbids a represenative on collecting commissions on his own account, the spousal account would be treated exactly the same way.

The addendum can be retroactive, but be aware that parties that opened accounts prior to the policy being changed can have a legitimate claim of "detrimental reliance" against the company and a request that the company still honor the claims.

Good luck.

Edited by Dimitry Alexander Kaplun on 11/2/2010 at 6:21 PM EST

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