Partner Disputes
Business partnerships are not unlike marriages in that disputes often arise when trust is broken, goals begin to diverge, or one member seeks to leave the partnership altogether. When your professional reputation and economic livelihood are at stake, resolving partner disputes quickly and effectively is essential.
Common Reasons for Business Partner Disputes
Regardless of the size and scope of your business venture, if you have a partner, you are likely to experience conflict at some point.
Partner disputes often involve:
- Business debt
- Control over the business
- Deceptive business practices
- Decline in revenue
- Future direction of the business
- Misappropriation of trade secrets
- Misuse of company funds
- Personality conflicts
- Poor management
Despite the many sources of conflict that can develop with any type of business, most partner disputes can be traced back to ineffective or poorly written partnership agreements. Whether verbal or written, these contracts created when the partnership was formed may not be stable enough to protect partners when something goes wrong.
Forming a Secure Partnership from the Start
Building a business is equally exciting and challenging. While you and your partner may be thinking big, it is essential that you draft a solid, well-defined partnership agreement that will protect both parties and your interests should you disagree down the road. Even if partners are friends, siblings, or even spouses, disagreements about each partner’s responsibilities can wreak havoc on a company. Similar to how a pre-nuptial agreement protects spouses in the event of divorce, your partnership agreement exists to protect partners and their business during times of conflict or separation.
