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CalAttorney2
CalAttorney2, Attorney
Category: Legal
Satisfied Customers: 10236
Experience:  Civil litigation attorney for individuals and businesses.
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Me and my two brothers have a verbal agreement that we are

Customer Question

me and my two brothers have a verbal agreement that we are patners of all our businesses. everything has went through my older brother through all of it. and we bouht a business together and he used it as collateral for an sba loan that he now has defaulted on and also a loan for product that we never seen and now my business is in jeopardy of being taking away from me and i feel that there is nothing i can do. im about to lose everything because he was able to do what he wanted with his name on everything. is there any way or anything i can do?
Submitted: 1 year ago.
Category: Legal
Expert:  CalAttorney2 replied 1 year ago.

Dear Customer,

I am very sorry to learn of this situation. Unfortunately, the answer to your question is highly contingent on the specific loan documents that your brother signed, and what authority he had under the partnership agreements.

It is possible that he did in fact have the authority to bind the partnership as collateral for his loans, but without a local attorney's assistance to help you review the actual documents you are going to be "fighting blind" and will be unable to make a good business judgment decision on how to proceed.

It isn't worth spending a lot on attorney's fees if your brother was authorized to encumber the businesses, BUT, if your brother exceeded his authority under the partnership, or if the loan documents were improperly drafted (promised collateral that were outside of the partnership), it is worth hiring a local attorney to defend your business.

However, without at least consulting with a local attorney, you aren't going to be able to form a good plan. The earlier you speak with a local lawyer, the more options you will have.

You can find local attorneys using the State and local Bar Association directories, or private directories such as www.AVVO.com; www.FindLaw.com; or www.Martindale.com (I personally find www.AVVO.com to be the most user friendly).

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