Partner is Filing for BK...what Do I Need to Do?

[coloagent]

Hello all...this is my first post. Thanks ahead of time for your responses. I started an agency about 9 months ago with 2 other guys, one of them is filing for chapter 7 and I am worried we will lose appointments etc. I worked real hard to secure these p&c appointments and couldnt imagine losing them at this point. We also have a GA we work with. My question is...will this cause us to lose these appointments? Will he lose his license leaving me with all the work etc? Lastly, how will this effect our E&O?

Thank you again. I can't hate him for doing this, but I need to look out for our business. For those of you with answers, thanks again.

 

[Mr. Bill]

Seriously, talk to your attorney. You may need to dissolve the partnership and set up a different entity. Good luck!

 

[Mark]

Seriously, talk to your attorney. You may need to dissolve the partnership and set up a different entity. Good luck!

Good Advice. I agree.

 

[coloagent]

Seriously, talk to your attorney. You may need to dissolve the partnership and set up a different entity. Good luck!

I should have mentioned that we are set up as a Corp. I think we sent it up this way just in case something like this happened. My lawyer feels we are fine and have no liability. Just worried we will lose appointments and E&O.

 

[arnguy]

Take your lawyers advice (notice that spelling Mark R.), that's what he's paid to do for you. Inasmuch as it is a corporation you are considered employees of that entity and it should not have any effect on your business. I am assuming that you are a C corporation, but even if you are an S corporation there should be no negative effect.

 

[Freddie]

Make sure that guy does not have control of the checkbook or can divert any funds without you knowing about it. Two signatures to write checks. Everybody is agrees on any expenditure over say $40. No personal credit cards the company is liable for. Get it in writing.

Make sure his personal problems do not become your problems.

 

[coloagent]

Thanks for all of your answers. Is he going to lose his license when it comes for renewal? If so, I may just offer to buy him out. Thanks again.