Starting business – Technical/Legal question

[Jason Freid]

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Hi Guys,

The company i was working for went into V.A 4 weeks ago. Last week we were told Liquidators are now appointed and have laid us off. Need to go through F.E.G for our entitlements blah blah blah.

The liquidators are trying to sell the business as “Plant and equipment & Data base”. You can leave it all on site and continue the rent if you like, even use the same well known name. They want a sale in the next 2-3 weeks.

My question is: I want to take the Clients with me…

Can i legally do this? Can i do this right after the company has gone into Liquidation? Do i wait? What do i do? If the ABN changes, its a new company, the clients are a free for all yes?

[Dave Gillen – Former FS Concierge]

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Welcome aboard [USER=117640]@Jason Freid[/USER]!

I can see your dilemma. Buying a database alone may not entitle them to any clients. But if they’re buying the company then they could benefit from any existing company policies that prevent you from taking clients.

From what you’ve said, it’s not clear to me whether they are purchasing the company or not.

Hopefully we have some legal professionals around who can help.

In the meantime, check the company policies and your employment contract for any relevant info. If it’s worth a lot of $ to you, it might be a good investment to seek legal advice. They may advise how to get the info you need without flagging the issue with the buyer/seller (and having them close the loophole).

Good luck!
Dave

Dave Gillen | LinkedIn

[James Millar]

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Check your employment contract.

Separate to that keep in mind employees have a common law duty of loyalty to employers and a common law duty of confidentiality to information owned by the employer. So there is a chance rogue behaviour might be a problem.

Helping build better businesses and better lives with expert financial and taxation advice. [email protected] www.360partners.com.au 03 9005 4900

[bb1]

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I’ll just throw one word in. Ethics

[Jason Freid]

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Dave – FS Concierge, post: 269491, member: 49676 wrote:

Welcome aboard [USER=117640]@Jason Freid[/USER]!

I can see your dilemma. Buying a database alone may not entitle them to any clients. But if they’re buying the company then they could benefit from any existing company policies that prevent you from taking clients.

From what you’ve said, it’s not clear to me whether they are purchasing the company or not.

Hopefully we have some legal professionals around who can help.

In the meantime, check the company policies and your employment contract for any relevant info. If it’s worth a lot of $ to you, it might be a good investment to seek legal advice. They may advise how to get the info you need without flagging the issue with the buyer/seller (and having them close the loophole).

Good luck!
Dave

Thanks Dave,

They are selling the Plant, equipment and data base. You cant buy the company and just keep running it the next day, because its liquidated. Will need a new ABN ect.

My employee contract did however have a Non Solicit clause for a 6 month period, but is that relevant being the company has Liquidated?

[Paul – FS Concierge]

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Jason Freid, post: 269496, member: 117640 wrote:

Thanks Dave,

They are selling the Plant, equipment and data base. You cant buy the company and just keep running it the next day, because its liquidated. Will need a new ABN ect.

My employee contract did however have a Non Solicit clause for a 6 month period, but is that relevant being the company has Liquidated?
Hi Jason,

If the liquidators are selling the assets and what you want for free is what they are selling, then the answer probably speaks for itself.

Asking the liquidators directly will be the best and most direct way to get a definitive answer.

Cheers

[JacquiPryor]

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Liquidators are now in control of the company, so prior contracts with company may very well still stand. If Liquidator is able to sell then that likely means the ‘same’ contracts, databases and similar will be in place. As mentioned above, chat to the liquidator. If they don’t have a buyer for all the assets they might be willing to negotiate sale of the client database as a stand alone?

I’m inclined to suggest speaking with an employment lawyer is your best bet here – to help understand what you can/cannot do under the employment contract but also might be able to put you in touch with others that could help negotiate purchase of database if that’s of interest to you.

[Jason Freid]

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JacquiPryor, post: 269501, member: 20176 wrote:

Liquidators are now in control of the company, so prior contracts with company may very well still stand. If Liquidator is able to sell then that likely means the ‘same’ contracts, databases and similar will be in place. As mentioned above, chat to the liquidator. If they don’t have a buyer for all the assets they might be willing to negotiate sale of the client database as a stand alone?

I’m inclined to suggest speaking with an employment lawyer is your best bet here – to help understand what you can/cannot do under the employment contract but also might be able to put you in touch with others that could help negotiate purchase of database if that’s of interest to you.

Excellent reply, and thankyou.

I’ll add that there were no contracts with clients. You break it, we fix it. Its the repeat clients im after. No contracts. Just like an automotive mechanic shop.

I have engaged an employment lawyer, but just wanted some other advice before i make a move.

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