Ownership in a corporation is typically determined by the number of shares of stock that an individual or entity holds. However, if a corporation never properly issued stock, the determination of ownership can be more complex.
One way to determine ownership in this situation is through a "de facto" analysis. This means that the court will look at the actions and conduct of the individuals involved in the corporation to determine who should be considered the owners. Factors that a court may consider in a de facto analysis include:
- Who contributed money or property to the corporation?
- Who has been managing and running the corporation?
- Who has been receiving profits and benefits from the corporation?
- Who has been holding themselves out as the owners of the corporation?
Another way to determine ownership is through a "quantum meruit" analysis. This means that the court will look at the value of the services or contributions that each individual has made to the corporation, and will award ownership based on the proportion of value contributed.
It's worth noting that, if a corporation never properly issued stock, it may also have other legal problems such as not having held proper shareholder meeting, not having a proper corporate records, etc. This can make it more difficult for the court to determine ownership, and may also make it more difficult for the corporation to conduct business or enforce agreements. In such cases, it's best to consult an attorney to advise on how to properly structure the corporation going forward.