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Is there a difference in 50/50 partnership (company) and…

Is there a difference in...
Is there a difference in 50/50 partnership (company) and 50/50 partnership in profits and loss?
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Answered in 2 minutes by:
8/5/2017
RayAnswers
RayAnswers, Attorney
Category: Business Law
Satisfied Customers: 47,712
Experience: I have 30 years as a business lawyer in Texas
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Hi and welcome to JA. Ray here to help you today.Please bear with me a few moments while I review your question and respond.

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No they are the same thing.The partners share equally in the profits and losses.They have equal say and run the business together under Texas law.Most partnerships have a partnership agreement that sets out the 50-50% and contains options for one partner to buy out the other one in event one wants out.

I appreciate the chance to help you tonight.Thanks again.

If you can positive rate 5 stars it is much appreciated.

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Customer reply replied 10 months ago
I have a whole big situation that I would be very appreciative of your knowledge and expertise.
My husband was approached by Rowland that he wanted to start a company 50/50 partnership. He spoke with me personally and told me this to translate to my husband. I have texts to where he asked my opinion on company names and if I had suggestions. He thougot of Bello Remodeling, my husband and I liked it. So we went with that dBa. The basic understanding was Rowland would get the jobs and my husband do the labor. After expenses for materials, expenses for labor, the profits would be split 50/50. First job came. Rowland wanted to include his marketing and job lead costs in the expenses. He also said he did not want to pay my husband his day labor. So we compromised. He included his marketing and lead costs and my husband lost his day pay. On this first job my husband and I realized that he already had dBa Bello remodeling under sole proprietor and that he had already opened a business account. We were not happy. My husband wanted everything as partnership. We all 3 went to bank of America, where business account is, and spoke with rep. We told her about the 50/50 partnership and how to change. She said to go change dBa to partnership. Rowland quickly responded why if an llc is just the same. So my husband was added full authority to account because we thought llc would place the 50/50 partnership. I also researched and realized we needed a partnership agreement. I told Rowland that one thing my husband and I were sure of is if partnership dissolves, then we would want the company to dissolve and neither could continue with the company name. This is where he quickly changed. He said he was sorry but that he did not mean 50/50 with the company saying that's equity, that he was talking about 50/50 profits and losses only. It's been about 7 weeks in. Yesterday demanded a partnership agreement. He pulled out 7300 from business account, blocked my access to company email so I could not see estimates. Today he said all he is willing to do is sign a paper stating Mario is 50/50 profits and losses and basic responsibilities.
Does that give us 50% of the company even if he is registered sole proprietor?
Can my husband do anything legally if more work is done under Bello Remodeling?
Can he stop Rowland from using Bello remodeling name?

I think you are going to need a local lawyer here.the partner has lied and taken advantage.Since there is no partnership agreement you may have to share for what you are owed.Your oral agreement was a 50-50% partnership and that what you thought you had.You may need lawyer if you want to recover your share and rights to the name.

I am so sorry this happened to you.I appreciate the chance to help here.

You have equal rights to the money, name, etc from what you present as the oral agreement and you can sue here if you have too.

If you can positive rate 5 stars it is much appreciated.

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Customer reply replied 10 months ago
The 7300 were deposits from clients for upcoming jobs. For 7 weeks, things were smooth. After all expenses, they split 50/50 profits. He just never wanted to do a partnership agreement. If he signs that Mario is 50/50 profits and losses, is that the same? Make his greed backfire.

Well the problem you run into here is that the partner starts taking money out of the business and suddenly after expenses there is not or little 50-50% to divide up.Sounds like he is taking a cut before there is a 50-50% split here and he decides what to take out as expenses and this changes.Thats the problem he is getting more than 50% of the money thats earned.Thats why you may need your own lawyer here to get what you are owed.This guy sounds bad news to me.

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Thanks again and thanks for rating 5 stars.

RayAnswers
RayAnswers, Attorney
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Experience: I have 30 years as a business lawyer in Texas
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Customer reply replied 10 months ago
He said he pulled the money out because after the letter I sent demanding partnership agreement, he wasn't sure if we would take money out of account. He did it to save clients deposits. Before the demand, we had access to estimates and contracts, after expenses they were splitting 50/50. I just have one question I need help in because I think my husband and Rowland are trying to work through this. 1. Is the 50/50 in profits and losses the same as ownership of company and rights to name?

No because you don't have any ownership/partnership rights --you just have a split of income/costs--he could change this anytime he chooses its just verbal.I think you need something that protects you in writing, him drawing out the funds is real red flag here ..

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Customer reply replied 10 months ago
Ok. With the understanding that my husband and I had that company to its entirety was 50/50, verbal agreement and supporting texts and emails. If he pushes my husband out and continues using Bello remodeling, is my husband entitles to 50% of profits. Would I have a case in small claims court?

You could sue here in small claims if you have too.

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Customer reply replied 10 months ago
Does this help? Can you help me write a letter of demand? Cost?

I am not allowed clients offsite here can only answer questions.

This is misleading, he claim you are partners but then hasn't done a partnership agreement.I would hold out for one now or look for a new partner.

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