Here is a checklist for when you close your business post-conflict. Closing your business can be difficult but it can be especially stressful when the business ended due to conflict. Even though there may be disagreements there are still many issues that need to be properly dealt with throughout the process. Some of the important items that must be completed include:
- Collection of outstanding debt
- Notification to creditors
- Customer Notification
- Termination of Lease
- Notification to Employees
- Liquidation of Assets
- Payment of Debts
- Tax Filings
- Close Bank Accounts
- Distribute Remaining Assets
- Dissolution of Business Entity
Follow the Law
After conflict there is likely to be tension and distrust amongst partners. It is essential that you follow the law throughout the process and do not try to make any changes to the agreed-upon procedures. When questions arise that are outside of the agreement discuss them with your attorney before proceeding. Dissolving a company requires business planning just as the formation of one does.
Divide and Conquer
While the business owners are not apt to work well together they should be able to delegate tasks that each must accomplish. Determine the items that need to be completed and divide them equitably between each. Set a completion due date so that you can be assured that the items will be done. Some items can be appropriately handled by another party as long as the overall process is managed.
Communication during the dissolution of the business is critical, but it could be difficult. It is likely that lack of communication was one of the causes of the breakdown of the relationship. Set regular meeting dates where all involved parties must attend in person. If there is a severe communication problem you may need to utilize the services of a mediator. Communicate through email to provide a written record of the discussions should litigation become necessary.
Now that your business is closing you may be concerned about your future endeavors and will probably want to move forward quickly. It is necessary to stay focused on the tasks of legally closing your business because mistakes could be costly. Failing to address all the steps necessary could have long-term repercussions.
Get Professional Help
Some issues are best handled by a professional. For example, filling out and submitting paperwork to dissolve the business entity may be best processed by a lawyer. Your attorney will help to make sure that all the proper steps have been taken prior to the dissolution to avoid complications later. Both parties need to adhere to the guidelines they agreed to in order to successfully disengage.
This blog should be used for informational purposes only. It does not create an attorney-client relationship with any reader and should not be construed as legal advice. If you need legal advice regarding When You Close Your Business Post-Conflict, or any other litigation matters, please feel free to contact Roger C. Decker at 480.461.5343, log on to udallshumway.com, or contact an attorney in your area. Udall Shumway PLC is located in Mesa, Arizona and is a full service law firm. We assist Individuals, families, businesses, schools and municipalities in Mesa and the Phoenix/East Valley.