You can seek draft of the agreement
get it vetted by any lawyer from this website
you cannot be forced to sign agreement against your wishes
Settlement after a dispute
Hi, I was a cofounder of a company however owing to a dispute with my other cofounders I couldnt continue with the company, I continue to hold some shares in the company which was diluted to a very meagre number now. I had initiated a civil suite claiming the patents, however withdrew the suite even before the first hearing. Now the rest of the partners wants to settle and want me to sign of the patent deed which I agreed. I am worried that I will eventually be asked to sign off on unrealistic terms and conditions since the relationship has been broken and they would want to come clean. I am trying to understand how do I avoid falling into such a trap and exit in a dignified manner.
Asked 3 years ago in Business Law
7 Answers
Please engage a lawyer to peruse the terms and conditions of the proposed settlement deed you may execute, in order to check if there are any clauses, terms and conditions detrimental to your interests. If there be any, negotiate with your partners to suitably modify them.
You should get in touch with some experienced corporate lawyer in your city to help with the exit formalities as well as to advice you in all facets.
You do not have to sign anything your partners ask you to before taking the advice of your lawyer and clearly understanding each and every term of the same.
If the terms of the agreement is not acceptable to you then yo can refuse to sign them.
You can place your demands suiting to your interests in the dissolution of the partnership firm.
You may follow the procedures for dissolution of the partnership firm as envisaged in the companies act if the terms and conditions are not acceptable to you.
In case of dissolution of partnership of firm, the firm ceases to exist. This process includes the discarding and disposing of all the assets of firm or and settlements of accounts, assets, and liabilities.
When a partner files a suit in the court, the court may order the dissolution of the firm when the court regards the dissolution of the firm to be just and equitable on any ground.
As per Section 37, of the Partnership Act, if a partner ceases to be a partner of the firm, and the remaining partners carry on the business without any final settlement of accounts between them and the outgoing partner, then the outgoing partner or his estate is entitled to share of the profits made by the firm since he ceased to be a partner.
- Further, the share may be attributable to the use of his share of the property of the firm or the interest at six percent per annum on the amount of his share in the property.
- Further, the surviving partner also has an option of purchasing the interest of the outgoing partner. If the surviving partner chooses to purchase the interest, then the outgoing partner is not entitled to any further share in profits of the firm.
- Since, you have settled the dispute and not want to continue , then you should enter into a Settlement deed after mentioning all the clause in details after narrating that after leaving the company, you will not be responsible for any affairs /transactions done by the company , the the company has nothing dues etc. towards you.
Dear client,
you can look into the terms of the deed first before agreeing to sign and maybe get an IPR lawyer with you to scrutinize it. As you have withdrawn the case there are not many options left other than this. So, you can re-initiate the suit again if you are not satisfied.
Thank you
You don't have to sign the same if compelled sign under protest
