Solving Partnership Disputes

Disputes between business partners often center on issues of money and control. As common as business partnership are, they can be quite difficult to sustain. Partnerships between any number of people often entail complicated relationships, which lead to conflicts within partnerships. Most issues between partners do not necessarily mean that the entity should be dissolved, liquidated, and split-up.  Rather, the problems can be solved with a collaborative approach and the relationships preserved.

Concerns about control and decision-making power must be objectively addressed and evaluated as soon as a partner starts worrying about how the business is controlled, begins to perceive unfairness, or has doubts about the integrity of another partner’s actions.  A collaborative approach toward resolution can be accomplished by working with an attorney to explore possible options, such as inspecting accounting books and records, before other dispute resolution methods are pursued.  One of the key steps in evaluating partnership disputes is examining the partnership agreement, which will typically set out how partners are to share management and financial control.

If you are entering into a partnership agreement, it is critical to have a practical understanding and approach before entering the agreement, and to have an attorney review the agreement to help prevent misunderstandings or mitigate the potential damage from future disputes.

If you are in the midst of a partnership dispute, it may be a good idea to revisit and revise the agreement, if possible, as part of resolving the dispute prevent future disagreement over matters such as management control or finances.

Sometimes a partnership dispute can be resolved with creative, cost-effective solutions through negotiation or mediation. Unfortunately, such out-of-court solutions cannot always be reached, and when other means have been exhausted, litigation may be necessary to move forward or remedy any wrongdoing or mismanagement.

Ezer Williamson Law provides a wide range of both transactional and litigation services to individuals and businesses. Contact us at (310) 277-7747 to see how we can help you with any business dispute concerns you may have.

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