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COA affirms dissolution of corporation embroiled in family dispute

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A company owned by two brothers – one disabled and one terminally ill – was properly dissolved by the trial court over the disabled brother’s objections, the Indiana Court of Appeals held.

Timothy and Randall Enders inherited Enders & Longway Builders Inc. from their father in the 1980s and each owned 50 percent of the company. They had a buy-sell agreement, which strictly limited their ability to transfer their shares of the company and provided that upon the death of one brother, his shares passed automatically to the surviving brother, unless, among other occurrences, the corporation was dissolved.

Timothy Enders stopped actively working for the company around 2004 because of a disability but had some of his bills paid by the company. Randall Enders continued to work until he became terminally ill in 2012. Randall Enders sought to dissolve the corporation because it was no longer profitable. Timothy Enders told his brother to “get out of bed” in order to make the company profitable.

Randall Enders filed a petition for a judicial dissolution of the corporation, alleging that the directors and shareholders were deadlocked in the management of corporate affairs. The trial court retroactively granted the dissolution effective the date of the hearing, even though Randall Enders had died the day after the hearing and before the court ruled.

The business’s accountant Mark McNamee testified at trial about the company’s lack of profits, that Timothy Enders hadn’t performed any services for the company since 2004, and the deadlock between the brothers over dissolving the company disadvantaged shareholders and directors.

“In short, the evidence before the trial court established that the corporation was no longer profitable because of Timothy’s disability and Randall’s terminal illness. Consequently, the business of the corporation could no longer be conducted to the advantage of the shareholders, who were deadlocked as to whether to dissolve the corporation. Accordingly, under these circumstances, we cannot say that the trial court erred when it dissolved the corporation,” Judge John Baker wrote in Timothy S. Enders and Enders & Longway Builders, Inc. v. Debra Sue Enders as Personal Representative of the Estate of Randall Enders, 71A03-1211-PL-494.
 

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  1. Your article is a good intro the recent amendments to Fed.R.Civ.P. For a much longer - though not necessarily better -- summary, counsel might want to read THE CHIEF UMPIRE IS CHANGING THE STRIKE ZONE, which I co-authored and which was just published in the January issue of THE VERDICT (the monthly publication of the Indiana Trial Lawyers Association).

  2. Thank you, John Smith, for pointing out a needed correction. The article has been revised.

  3. The "National institute for Justice" is an agency for the Dept of Justice. That is not the law firm you are talking about in this article. The "institute for justice" is a public interest law firm. http://ij.org/ thanks for interesting article however

  4. I would like to try to find a lawyer as soon possible I've had my money stolen off of my bank card driver pressed charges and I try to get the information they need it and a Social Security board is just give me a hold up a run around for no reason and now it think it might be too late cuz its been over a year I believe and I can't get the right information they need because they keep giving me the runaroundwhat should I do about that

  5. It is wonderful that Indiana DOC is making some truly admirable and positive changes. People with serious mental illness, intellectual disability or developmental disability will benefit from these changes. It will be much better if people can get some help and resources that promote their health and growth than if they suffer alone. If people experience positive growth or healing of their health issues, they may be less likely to do the things that caused them to come to prison in the first place. This will be of benefit for everyone. I am also so happy that Indiana DOC added correctional personnel and mental health staffing. These are tough issues to work with. There should be adequate staffing in prisons so correctional officers and other staff are able to do the kind of work they really want to do-helping people grow and change-rather than just trying to manage chaos. Correctional officers and other staff deserve this. It would be great to see increased mental health services and services for people with intellectual or developmental disabilities in the community so that fewer people will have to receive help and support in prisons. Community services would like be less expensive, inherently less demeaning and just a whole lot better for everyone.

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