Question posted in the General Law category relating to KwaZulu-Natal
We took a chemical manufacturing business over in August 2018 from the owner at JOAT. A contract was drafted but never finalized with terms or valuation of the business. The business was running at a much bigger loss then communicated and we spend the last two years trying to turn it around. The one employee that came with the business remained on the JOAT payroll until last year December 2019.
We got called in and were told that the employee should have been taken off the payroll when we took the business over and we are liable for his 14 months salary.
We were aware that the employee was still being paid by JOAT but we never pushed for it to be changed as JOAT took chemicals from us without paying every month and no finalization of the valuation of the business or contracts were in place.
We got to the premises yesterday and JOAT put a lock on the gate claiming they want a copy of the contract and we need to pay them the 14 months salary for the employee. Before lockdown, we met with the financial manager at JOAT to explain the situation and said that we are trying our best to sell the business to repay the moneys owed to them.
With Covid-19 situation, we have not been able to trade to try and meet any of the obligations or find a buyer for the business. Please can you advise us on our legal rights as I need to go and see JOAT today to sort it out. Can we exercise our right with Force Majeure and just hand JOAT the business back and walk away from all the money we invested in the last almost 19 months?