Director Responsibilites After Resigning

Discussion in 'Growing and Managing a Business' started by centro, May 2, 2013.

  1. centro

    centro
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    Hi,

    I set up a business with someone to instal and maintain security products. We had many arguments which slowly progressed and exacerbated. A couple of months ago he told me that he wants to resign as Director and sell his share (£1). But only after we completed a large project and he took his 50% dividend.

    That was all fine. However issues have arisen on the project after we had signed over the completion to our client and shortly after he took his share. He resigned 3 weeks ago, project completion was 4 weeks ago and since then we have had about 4 call outs for problems. His role in the company was to head up the installations as his background is as an engineer and mine was the office and client side. He has even admitted that he has done all the work on site in an email.

    As he installed it and it is a fairly complicated system only he can fix the problems. It might be worthwhile mentioning that he in fact sub contracted some of the work to someone else who had more knowledge than him.

    However, he is telling me that he has no responsibility anymore as he resigned as Director and that if I want him to fix the issues then I need to pay him x amount per hour.

    From a legal point of view, would he still be liable or is it the company itself?

    Many thanks in advance
     
  2. scifi

    scifi
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    Depends what are the depth of agreement and points of agreement between you two...However technically if he had also signed the document with Project client while he was director..he can not leave untill the completion of the project..his duties and liability are limited however after the completion of the project//....You can see that
    legal case can be prepared on the basis of that he was previously aware of the issue and problem you are going to face being an expert in the technical side of the project left you consiusly in the situation..
     
  3. Fergal

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    Welcome to Business Advice Forum centro, thanks for joining.

    Legal questions are very complex and the answers depend on the specific circumstances of the case in question. I'd suggest that you seek professional legal advice, in relation t this matter. An initial consultation should give you a good steer as to whether or not your former partner has an obligation to support the project. Plus some legal professionals will give you a first consultation free of charge.

    Something else to consider is whether or not your business is obliged to provide support to your client. Do you have a contract with the client? If so, what does the contract say about supporting the system after it has been installed?
     
  4. centro

    centro
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    Thanks Scifi & Fergal.

    We have a service contract with the client, signed for annually inspecting and maintaining the system. We also have a monitoring contract in place which is sub contracted to a monitoring company. When we split the dividends, the annual maintenance fee was included as we were paid up front by the client (maintenance is due next year). So my ex business partner has taken 50% revenue as a dividend for that (if that makes sense). It was an error on my part to not have deducted that.

    One of the cameras has stopped working. Ex business partner went to site, said its a faulty camera (which is under warranty) although I am abroad at the mo so will check when I get back.

    What type of legal expert would I require?

    Many thanks
     

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