Would This Contract Stand Up?

[JJJIIIMMM]

ok guys, following on from the two previous threads i started, i have come back to you knowledgeable people for some more advice (sorry to keep asking, i will try to give back soon)

my wife and i have decided to divorce

we own our house in our company name, and we both hold 49% each of this company

we have agreed, that if i give her THB 20,000 per month for 20 months, then when i come to sell the house, she will allow me to take all the money from the sale

she has just phoned our thai / farang accountant office (who helped us to buy the company and set up our existing shareholder contract etc), and one of the guys who works there (not the top man BTW) has said that such a contract can be drawn up, and will stand up in court if, she tries to take back more at a later date

the account has a lawyer whom can draw this up, and we are booked in to see them this friday

i am happy to pay her this money (we have only been married one year and 1 month), but i forsee that there may be many opportunities for her to take more cash from me in the future

what do you think guys? is a watertight contract like this possible? and if so, what should i look out for in the meeting on friday? (ie contract in thai and english, certain stamps required, her sign out on her shares now, copy of her ID card put on file, etc etc)

thanks for taking the time to read this, and thanks for any forthcoming replies

[Mario2008]

Can't see why it shouldn't stand up in court, but only a lawyer can give you proper legal advise.

Thai law doesn't know alimony, only child support.

[Swiss1960]

First question would be: Why not sell the house now, give her the 400K out of the sale and you keep the rest?

Second question: the house belongs to a company where you are both shareholders. How legal is it - for you as shareholders - to decide about a future business transaction of the company AND even write that business transaction down in a divorce contract? Would definitely not work Europe, since shareholders have no rights to decide about assets of the company.

[JJJIIIMMM]

First question would be: Why not sell the house now, give her the 400K out of the sale and you keep the rest?

Second question: the house belongs to a company where you are both shareholders. How legal is it - for you as shareholders - to decide about a future business transaction of the company AND even write that business transaction down in a divorce contract? Would definitely not work Europe, since shareholders have no rights to decide about assets of the company.

Hi swiss1960 - the reason we dont sell the house is i dont want to, if i dont have to. it is a great house in a graet location and i love living here

i am not sure if it will be legal, but it is not a divorce contract i dont think, more of a deal now that on the day of us selling the company in the future she will not ask for any of the proceeds of the sale to be paid to her.... has anyone heard of anything like this?

i just dont want to pay her the money every month and then in 2 years time she decides whe wants more

[iluvbeaches]

If you are not divorced I think all contracts made during the course of a marriage are able to be dissolved at will by either party. Better to get divorced and the make the contract.

Not positive as I'm not married to a Thai but from my experience with friends this is the case.

[MrRealDeal]

You mean aside from the fact that setting up a company that's not a company only to buy land and a house is illegal in the first place ?

It's impossible to set up a watertight contract when your foundation is illegal to begin with.

The only thing you need to split under Thai Law is any assets that were produced during your Marriage so I don't see why you would worry about paying her any more than that if you gifted her something she would get to keep it just like anyone else would if the friendship dissolved.

[1kate1]

You say you have 49% each.....who holds the other 2% of the company? That is possibly where you may have problems as the norm for a foreigner purchasing with a company is..... 49% Foreigner and 51% Thai..

If the 2% is held by a Thai......you are screwed....sorry.

The best thing to do is pay her off.. NOW otherwise you will end with nothing as she will turn you over Big Time......You state you have been married 13months so for her its now time to move the next one in you have served your purpose.......sorry I do not want to offend you in any way but sadly this is the way it is this side of the planet.. Sure she has made contact with a Thai? accountant....he will probably be in on it working against you........Be Very Careful and do not go long with.any of her suggestions.....stay safe.

[MrRealDeal]

Here is basically how it will work if you end up in court.

You : Excuse me Judge why are refusing all of my requests and being so unreasonable just because I set up an illegal corporation and bought a house and land ?

Judge : Because you set up an illegal corporation and bought a house and land, any more questions ?

You : Will I lose everything ?

Judge : No you will get something from all this.

You : Well you decision doesn't give me anything Sir, you said I would get at least something ?

Judge : Yes your Lawyer will give you a bill on your way out , have a nice day.

[JJJIIIMMM]

You say you have 49% each.....who holds the other 2% of the company? That is possibly where you may have problems as the norm for a foreigner purchasing with a company is..... 49% Foreigner and 51% Thai..

If the 2% is held by a Thai......you are screwed....sorry.

The best thing to do is pay her off.. NOW otherwise you will end with nothing as she will turn you over Big Time......You state you have been married 13months so for her its now time to move the next one in you have served your purpose.......sorry I do not want to offend you in any way but sadly this is the way it is this side of the planet.. Sure she has made contact with a Thai? accountant....he will probably be in on it working against you........Be Very Careful and do not go long with.any of her suggestions.....stay safe.

please dont make assumptions about my, wife and tar all thai women with the same brush. you may have had a bad experience or two, but this does not mean all thai women are bad. how do you know i havent been knocking seven shades out of her for the last 13 months? you dont know.

what would really help me would be an evaluation of the contract i discussed in the opening post

[Mario2008]

1 flame removed.

Let's stick to the question.

[MrRealDeal]

You say you have 49% each.....who holds the other 2% of the company? That is possibly where you may have problems as the norm for a foreigner purchasing with a company is..... 49% Foreigner and 51% Thai..

If the 2% is held by a Thai......you are screwed....sorry.

The best thing to do is pay her off.. NOW otherwise you will end with nothing as she will turn you over Big Time......You state you have been married 13months so for her its now time to move the next one in you have served your purpose.......sorry I do not want to offend you in any way but sadly this is the way it is this side of the planet.. Sure she has made contact with a Thai? accountant....he will probably be in on it working against you........Be Very Careful and do not go long with.any of her suggestions.....stay safe.

please dont make assumptions about my, wife and tar all thai women with the same brush. you may have had a bad experience or two, but this does not mean all thai women are bad. how do you know i havent been knocking seven shades out of her for the last 13 months? you dont know.

what would really help me would be an evaluation of the contract i discussed in the opening post

The contract might hold up but that might not help as much as you think ..... the part of the contract that would hold up would be the part that is "Legal from the inception" the part that could not be enforced would be that which is "inherently flawed" .......... What that means is She might be able to enforce the new contract which you only made to get what you wanted from the illegal house part , but you couldn't enforce anything about the house because it was not Legal from the inception.

What I am trying to tell you is that the contract is only enforceable for her because it's a new contract. But the house part is not enforceable because it was illegal from the start and no new contract can change that.

It's asking the Judge to reward you by upholding your side of a new contract that only came about to protect you from illegal actions ..... Courts simply don't do that.

Now she might be happy and it never get to a dispute a Judge has to decide, but trust me when I tell you Judges do not reward people for new contracts they make to keep assets that came about from an illegal transaction. In fact they get a lot more angry that you tried to use their Court to do it than you probably realize.

[MrRealDeal]

The other part you might not realize is that you might be thinking that since she was a party to the whole house deal she is as guilty as you and shouldn't get rewarded for it , which is reasonable but not what is likely to happen.

She would be considered under the Law as an innocent party , even though she obviously is not , because if not for you her 49 percent stake would be just fine , since the entire deal was illegal from the start and only because of you in the eyes of the court , even though that's also not especially true , you can not benefit from the transaction , that doesn't mean all the shareholders should lose out , the 49 percent has to go someplace and courts long ago determined that rather than screwing everyone and giving the money to the government it should be split between the shareholders who if not for someone else would not have been harmed, in whatever proportion they own of the stock.

I realize your wife is nice and you think it wont be a problem and I hope it's not , but since your looking for watertight contracts in the back of your mind someplace you have considered it might be.

The best protection you can give yourself is to start doing something , anything at all , in the effort to make the company you set up real and actually be a company ..... then everything I said goes away because it's all legal now and you would have nothing to worry about. Then the new contract would be perfectly enforceable and your 49 percent stake in the house and land as well.

My only other concern for you is that a 49 percent stakeholder can not force a sale against the will of 51 percent of the shareholders without a Court order, so you need the approval of the 2 percent person to sell the house.

So my concern would be if I were you, in making a contract that says she gets paid for 20 months and then you keep the house money, that the house actually get's sold , that means that you need some sort of contract with the 2 percent shareholder as well to make sure it happens , otherwise it might not. In order to insure that, personally I would make the contract so she only gets paid when the house is sold.

[MrRealDeal]

Here is what I would do in your situation aside from making the company Legal which is the best option ....

I would dissolve the company and get all the shareholders together to contract on who gets what from the sale of the company assets , it's not Legal to have her sign her shares to you because then the company is not 51 percent Thai owned , however it is Legal for a 49 percent shareholder to contract for less than 49 percent of the assets of the sale. Now based on what you said not so much what I would do which is sell the house right away , you can set the dissolution date into the future and begin payments today to her which would pretty much seal the deal because she accepted and benefited from it and in 20 months can't complain she didn't like the deal. I would have the 2 percent person sign it and make a payment to them under the same principle with perhaps some small extra amount for both in the sale .... if they get even a small amount from the sale it will motivate them to not cause trouble because the sale money is solid and some Lawsuit is not so much , a bird in the hand thing.

If everyone is getting everything they claim to want under this contract but doesn't want to sign it's because they must want something else , doing this will either solve the problem or alert you that there is a bigger problem.

If your Lawyer tells you she can sign her shares or voting rights to you and give you control of the company he is mistaken. If that were the case people would simply set up company's with poor people and buy them out the next day or some time later so it didn't look like fraud.

I think you miss the importance of the 2 percent shareholder who actually holds some of the cards on the table , the 2 percent holder gets to decide what happens because his shares make for 51 percent of the company , they can side with either of you and the 49 percent person is out of luck so they are pretty important in the contract as well. My guess is that you don't have 100 percent faith in them otherwise none of this would matter because you would have 51 percent control anyhow and could do what you wanted. If my assumptions are wrong ignore them ( especially the part about it not being a real company) but you will be far better off with the 2 percent person involved than without them and it would indicate to me some kind of partnership with the girl if they didn't want to agree to everything , if they are disagreeing with you it's not because they are on your side.

Having said all that if they were trying to actually screw you over they would probably just sell the house and keep the 51 percent of the sale which I assume is more than they paid into it rather than hope for more from a Lawsuit.

My last piece of advice is that it's exceptionally unwise to let a person you don't especially seem to trust, to be setting up a deal and making the phone calls for a contract you are making to protect yourself from them. Being polite is nice and all but in this situation it's just dangerous. "Our accountant" and his Lawyer friend should be changed to " Your Lawyer".

I apologize if my assumptions about it not being a Legal company were wrong but in my defense most people with real company's have real lawyers and don't need advice from the internet and most people in a divorce with a real company and a house have a lot more to worry about than just a house and would be more worried about the company which you haven't even mentioned and people getting divorced almost never remain business partners. So if my assumption is incorrect at least it would not be an unreasonable one.

[MegaRanter]

Buy back her shares in the company, or get her to transfer it to someone of your choice, that makes her decisions to company assets irrelevant.

You want to continue living in this house? Sell the company to someone else and the lease it for the rest of your years.

This monthly 20k payments, if she did not deserve it for the 13 months she was in it, and can live for less, I suggest you reduce the monthly stipend to about 10k, and to 40 months, or 5 k for 80 months.

Finally, a good lawyer, will tell you to sell before divorce, so you can start anew.

Been there done that.

[Gsxrnz]

Are you "legally" married in front of the Amphor?

[MrRealDeal]

Buy back her shares in the company, or get her to transfer it to someone of your choice, that makes her decisions to company assets irrelevant.

You want to continue living in this house? Sell the company to someone else and the lease it for the rest of your years.

This monthly 20k payments, if she did not deserve it for the 13 months she was in it, and can live for less, I suggest you reduce the monthly stipend to about 10k, and to 40 months, or 5 k for 80 months.

Finally, a good lawyer, will tell you to sell before divorce, so you can start anew.

Been there done that.

He can't buy her shares and still have a Legal company ..... He can't sell the company he can only sell his shares in it.

[hanuman2543]

Your contract will not stand up because of CCC, Section 1469

Section 1469. Any agreement concluded between husband and wife during marriage may be avoided by either of them at any time during marriage or within one year from the day of dissolution of marriage; provided that the right of third persons acting in good faith are not affected thereby.

Nobody could stop your wife taking your payments and then suddenly change her mind. Divorce her first and put a payment plan in the divorce agreement. You should ask a proper lawyer and not the 3rd man in an accounting office.

[Mario2008]

I believe the agreement to be part of the divorcement settlement was the plan.

[PattayaPhom]

She should sign her 49% over to someone you trust now and have a contract stating you will pay 20k a month, you then have the leverage. If she refuses then something is wrong. How will you be able to sell the house?