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lwpat, Attorney
Category: Legal
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Experience:  Actively practicing trial attorney
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I have been working in california in the family business for

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I have been working in california in the family business for over 10 years full time and part time for longer. In 2006 i decided to move on and my family said i could get a part of the business and they would gift 10,000 in shares if i stayed each year. So everything has been good until now, i have a bout 20 percent. This year my father said he decided to not gift me anything even though i worked a full year last year. He is part time now and i am still full time. It was a verbal agreement, nothing was in writing except clearly this has been happening each year since 2006. Do i have any legal protection? Can he do this? I feel at the very minimum he should gift me for what we had agreed upon since i did my part and worked a full year. Please help. It's an S corp.
Submitted: 4 years ago.
Category: Legal
Expert:  lwpat replied 4 years ago.
Thank you for your question and for using JA. Please click accept so I will receive credit from JA for my time.

A verbal contract is enforceable. Normally the problem is proof but here you have a course of dealing over quite a number of years. The difficult question is how you want to proceed. You can sue and probably win. However, you will be out of the company and as a minority shareholder there is going to be little that you can do. You could then sue to try and force the dissolution of the contract but that will take you four or five years and significant legal fees.

The question is why your Dad is not issuing you the shares and why the communication has broken down. I would suggest trying to have a third party that you both trust mediate the issues and try to reach a resolution without involving attorneys.
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