Nightmare business situation

[ghost83]

So for context my dad started a business back in 1992 with my mum and I came into it when I left school in 2000, he married my stepmum in 2013, she does the computer stuff for the business like invoicing and paying bills,

So my dad died in 2025 in a tragic accident (can’t speak about it still ongoing)
The only person that can run the operational side is me, without me it fails to exist, this business can’t trade only operate under strict licensing,

So everything was going ok till February we initially agreed a deal on everything and then in February she reneged on part of the deal meaning she would have to leave the business,

She’s refusing to leave the business unless I pay her off, first she wanted quarter mil now she will leave for 8k

She’s run up mountains of debt by not paying them and she’s failed to pay me for 3 months! Yet still paying herself, I’m on the banking mandate but she refuses to add me onto the online banking, she’s also transferred one of the companies into her sole name and only got me as a non equity director!

I also add that we have a partnership and limited companies and unbeknownst to me the partnership had bounce back loans attached so I’m on the hook for half the debts half the bounce back loans, stressed is an understatement,

She’s also trying to blackmail me to agree to her terms (6500 that she wants is to pay her credit card that she says was used in the business but can’t prove it yet she’s taking the payments out every month)

I’m 10k deep with a solicitor yet they won’t let me settle as they want the licence to go through first and say her taking money for credit card without proving it is embezzlement

Seems a mess and I can’t just walk away as the debts are in the partnership

[StevieBee]

This sounds a little like a case of not interrupting your enemies while they're making mistakes. But......

You mention more than one business. Does this situation apply to them all?

What is the legal structure of the business in which the debts exist. You say it's a partnership but is it Ltd, LLP, etc? - and/or what is the legal nature of your exposure to the debt?

Is there a shareholder agreement and does this set out any succession strategy in the event of the death of a partner?

Who is the PSC?

Are you due any inheritance from your father? (and really sorry to hear about that).

[Uncle boshy]

Is it possible to set up a new business that takes over the existing client base, leaving the existing business with the mil and the financial issues?

Although not quite the same, I have a mate operationally running a specialist knowledge business. the widow of the founder has no ability to run the business but is demanding large payment to buy her out. In their case it makes sense to set up a new business and take the staff and clients with them, but there are no significant tangible assets to leave behind .

[wolf1]

I'm possibly wrong however I suspect she has been diverting funds with the intention of walking away with a substantial sum of money and is now asking a derisory sum in a vain attempt to avoid any suspicion. You either need to delve very deep and very fast to find out what has gone on or set up a fresh company ready to shift clients etc and fold the old one if the proverbial hits the fan.

[Eric Mc]

Do you deal with the accountants or was that side of things left up to her?

Sounds like you have not been properly on top of what has been going on regarding how she was dealing with the financial transactions.

[Nicetobenice]

First thing to do is to speak to the bank immediately and insist on changing the mandate. At least that way you will stop the situation getting worse.

Then tot up all the debts and decide if you can trade through it. If it's too much then either resign from it all or appoint a liquidator.

[Simpo Two]

ghost83 said:

in February she reneged on part of the deal meaning she would have to leave the business,

She s refusing to leave the business unless I pay her off, first she wanted quarter mil now she will leave for 8k

This is the bit where holes need to be filled in I think, before working out anything else.

From £250K to £8K sounds a bit unhinged IMHO.

wolf1 said:

I'm possibly wrong however I suspect she has been diverting funds with the intention of walking away with a substantial sum of money and is now asking a derisory sum in a vain attempt to avoid any suspicion. You either need to delve very deep and very fast to find out what has gone on or set up a fresh company ready to shift clients etc and fold the old one if the proverbial hits the fan.

I think this is it; she's trying to shake you off, and not doing it very well.