I've been an idiot

wrongchoice_2

Long-time user, but new alias due to subject!

Some time ago I and a friend set up in business made possible by me putting in my savings. My friend said that she would run the business while I continued to work fulltime (to pay the bills), and for 4 months or so it seemed fine. It wasn't making any money, but wasnt expected to immediately, however I started noticing that my friend didn't seem to be spending as much time running the business as I had thought she would, in fact she seemed to be leaving the part time staff on their own most days.

Then due to financial reasons she returned to part time work and was rarely there. During this time, she had full control of the administration of the business - a decision made by both of us as she had elected to run it. However, it became increasingly more difficult to get in contact with her - phonecalls not answered, nor were texts and eventually emails were ignored. The odd thing was that during this time she appeared to be totally as normal when we actually met up, but the weekly reports that were promised never materialised.

Eventually she recommended that we give up our premises as our staff had walked out and I agreed, although with a heavy heart as I didn't want to end up with big bills - it was bad enough that I'd lost most of my savings.

So now, despite repeated emails requesting closure, I am getting no answers. I closed down the website and emails, although not before I looked at her account. She had been criticising me to both staff and business contacts - why, I have no idea.

She has half of our stock and some of our fixtures, as do I. The reason for this (sorry, long) story and rant is I am totally at a loss as to what to do next. Any suggestions would be very gratefully received.

westy22

Some time ago I and a friend set up in business

This is the crucial bit - was it a formal partnership with a written agreement or was it an incorporated company with you both as shareholders? Or was it just a verbal agreement? If a verbal agreement then your friend could say that you just invested some money into her business and that she was free to do what she liked with the business!

wrongchoice_2

No, it was a limited company, registered correctly at Companies House, with us both listed as directors.

westy22

In that case there are clear legal steps that need to be taken by the directors to legally dissolve / close the company. As co-directors you are jointly and severally responsible for closing down the company in accordance with company law. Joint and several liability means that both or either of you individually can be held legally responsible for ensuring that everything is done correctly.

Your first step should be to carefully read your Articles and Memorandum of Association and see what they say about closing the company; the second step is to review any Shareholders Agreement that you may have had drawn up and pay particular attention to what should happen if you wish to close or dissolve the company. Having completing these steps you can read detailed information regarding closing or dissolving companies on the Companies House website.

Good luck - it can be a torturous process!