QUESTION
Worried about handshake loan from Partner's family member
Asked on Dec 18th, 2016 on Business Law - Florida
More details to this question:
Hello, I have a question regarding a handshake loan for my business. I founded my company in Florida with one other partner and we received a loan to get started from his mother. We each signed a personal guarantee. 1 year later, things are not working out as predicted with the partner and I am thinking about separating and just starting on my own. I have enough money to cover my percentage of equity in the company. My worry is that upon separation, bad blood could be there and the mother tries to go after the full loan amount from me and not her son. Basically as a business and personal guarantor we signed for a loan of 100k. When I try to separate, I just want to hand her a 50k check and be done with it. Can she ignore her son's loan obligation and try to come after me for the full 100k even though we are 50/50 partners?
1 ANSWER
It's not entirely clear from your email, but I assume that the loan was madee to the business, which is a separate legal entity (e.g. a corporation, llc, llp, etc.) and you each personally guaranteed that obligation. Assuming that you guaranteed the full amount, and not just half, and that the guarantee obligation has been triggered (generally such an obligation would be triggered by a default on the loan, or other similar circumstances) the mother can sue you for the full amount, and you would then cross claim against your former partner for his share and sue the business for indemnification for any amount you have to pay on the guarantee.
Answered on Dec 19th, 2016 at 9:00 AM