Is my ex-business partner still liable to the debt and can he tax me?
A year ago me and two business partners started a business with an online product in order to fund the development of another large-scale online product.
They provided a line of credit rather than an investment for my lack of net worth on my end and also valued all I had done thus far prior to the creation of the company to zero. The company made some sales to which they had zero contribution in terms of effort on any front other than consulting and never got their hands dirty. I was also forced to take on a full-time job and to continue all my responsibilities of the company.
After being at loss for a few months the company ended up with a debt of 16k on its line of credit which they had provided.
They then decided to pull out and leave me with the debt and to pay none of it themselves before withdrawing in exchange for me keeping the company.
I was simply disgusted by their attitude and their track record thus far and simply wanted them out (which was not the wisest given I should have made them pay their part first). Legal documents were drawn and government registrars were updated for their removals.
However, the bank refused to remove both parties from the debt given I had zero net worth and thus kept one of them liable.
I have since continued the company's operation, created a steady cash flow and also put together a team to grow this cash flow. I am paying all minimum payments and more when possible on a monthly basis.
Now that individual would like to tax me an amount per month given this is impending on his credit score and lending ability (even though is he is very well off and makes a 6 figure salary and has a high net worth).
Is this even legal? Also, is this not something he should have considered before leaving the venture? How is this my problem at this point? I was threatened that he could tax me an even larger amount as per recommended by the other partner.
In the event that I decided to dissolve the company, the bank would be going to him to claim the amount given his liability to the debt since I would have nothing to offer.
Though he is not legally signed off as a person in ownership of the company would he be forced to pay off that debt to the bank?
Given he does not have any ownership of the company but is still liable, can he get out of it? Does that mean I would be declaring bankruptcy? If so, would that not also affect his credit score and lending ability?