An improperly handled partnership dispute can cause a lot of headaches, to say the least. While you’ll be forced to deal with the stress associated with the conflict, unresolved issues can threaten your business operations, your profitability, your reputation and even your business’s ongoing viability. As a result, then, there’s a lot at stake when you find yourself enmeshed in a partnership dispute.
But while figuring out how to handle a partnership dispute can be challenging, there are steps you can take to make it easier to get through the process. And if you’re careful, thoughtful and strategic, you might come out of the ordeal with a salvaged business and an ongoing business relationship that protects your short and long-term interests.
But how, exactly, can you navigate your partnership dispute? There’s no one-size fits all approach, as each circumstance is unique. However, there are some broader strategies that you may want to consider utilizing in your case.
Tips for resolving your partnership dispute
Although you might feel hopeless when a partnership dispute arises, there are steps you can take to protect your business and thus your financial interests. Here are some that may prove helpful in your situation:
- Find time for open and honest conversations: If you can identify issues between yourself and the other partners in your business, then you have an opportunity to head off problems before they get too big. That said, the conversations you have with your partners need to be open and honest. If you skirt around the true issues at hand, then they’ll continue to fester, further infecting your partnership. As you have these conversations, look for common ground that everyone can live with, and be sure to listen without interrupting and focus on the facts rather than on emotions.
- Use a mediator: If circumstances prevent you from having a meaningful dialogue with your partners, then you may need to consider alternative dispute resolution, like mediation. A mediator can help you and your partner frame the issues that are in play and facilitate meaningful conversations about resolution. They can also help you draft agreements and even modify your existing partnership agreement.
- Seek injunctive relief: If your partner is acting in a way that’s harmful to your business and monetary damages are insufficient to protect your interests, then you might want to seek an injunction. If successful here, a court order will prohibit your partner from engaging in certain conduct. This option is particularly beneficial if you and your partners have non-compete agreements in place.
- Think about dissolution: Although you may not want to think about it, dissolution of your business may be your best option if you’re unable to come to any kind of fair and favorable resolution to your partnership dispute. If you’re at that point, then you’ll want to be sure to review your partnership agreement for guidance as far as how to dissolve your business, but you might also need to turn to the court for assistance.
Know how to protect your interests in a partnership dispute
There’s a lot at stake when you’re in the middle of a partnership dispute. You can’t afford to let your anxiety, fear and uncertainty lead to hesitation and acquiescence. Instead, you need to move forward with confidence and a strong legal strategy that protects your interests. If figuring out how to do that has you on edge, don’t worry. You can continue to read our blog and the rest of our website for more information about the next steps to successfully address a partnership dispute.