Question: Castleberry Branscum and Byboth each owned onethird of the shares

Castleberry, Branscum, and Byboth each owned onethird of the shares of a furniture-moving business, Texan Transfer, Inc. Branscum formed Elite Moving Company, a business that competed with Texan Transfer. Castleberry objected and sued to claim part ownership of Elite Moving. Branscum threatened Castleberry that he would not receive any return on his investment in Texan Transfer unless he abandoned his claim of ownership of Elite Moving. Consequently, Castleberry sold his shares back to Texan Transfer for a $42,000 promissory note. Gradually, Elite Moving took over more and more of the business of Texan Transfer. Texan Transfer allowed Elite Moving to use its employees and trucks. Elite Moving advertised for business, while Texan Transfer did not. Elite Moving prospered, while Texan Transfer's business declined. As a result, Castleberry was paid only $1,000 of the $42,000 promissory note. Did Castleberry have any grounds to hold Branscum liable for the unpaid portion of the note?

View Solution:

Sale on SolutionInn
  • CreatedJuly 16, 2014
  • Files Included
Post your question