Partnership disputes often take the path of failing marriages, where you feel as though you’re more powerful together, and that together you can take on the world. Yet as the years go on, people change, circumstances change, and suddenly you may want different things, or have different visions about how to move forward.
Unfortunately, when partnerships go wrong, the business is often impacted in a negative manner, which can magnify and add fuel to issues within the partnership. From partners refusing to act in good faith to partners attempting to enforce heavy-handed clauses against departing partners, partnership disputes can quickly become personal.
In more drastic situations, one partner may go rogue and take actions that are contrary to the initial shared vision. Some common scenarios of this include: misappropriating funds; blocking another partner’s access to bank accounts or other partnership information; entering into contracts unilaterally; and making decisions impacting the partnership without the other partner’s consent, approval, or input.
If you’re stuck in the middle of a partnership dispute, you need the right lawyer in your corner. Our firm has the experience to help you navigate these intricate matters in a delicate way so that your business can continue to thrive while maintaining its reputation. We can utilize alternative dispute resolution processes, such as mediation or arbitration, to resolve these disputes with the goal of minimizing any impact on the business itself. If necessary, we will not hesitate to commence a lawsuit or defend one vigorously.
When the partnership was formed, you and your partner(s) likely entered into a partnership agreement. This is a contract between partners that governs the parties by, among other things, stating the roles and responsibilities of each partner, the manner in which decisions impacting the partnership are to be made, and how assets will be divided between partners. It usually also contains language about what happens if a partnership should end, and how disputes between the partners should be resolved. Although these contracts are sometimes in writing, they are more commonly verbal agreements that the partners did not reduce to writing given their initial mutual trust.
If your partner breaches the partnership agreement (oral or written), you can sue him/her for breach of contract. Your partner’s breach may arise from a failure to abide by his/her obligations under the agreement or from acting in bad faith.
Your partner might also be breaching other requirements that you have previously agreed to, or which are imposed on the partners by law, such as duties of confidentiality or non-competition or non-solicitation agreements (sometimes known as restrictive covenants). These breaches may give rise to several other grounds for a lawsuit, aside from just a breach of contract.
If you need to pursue a legal claim against your former or current business partner, a partnership disputes lawyer can help you bring that claim before the court, or seek other ways to resolve the matter without resorting to litigation.
An injunction is a remedy the courts grant which often requires a party to take a specific step or conversely requires a party to refrain from a certain action.
The party who brings an injunction usually seeks urgent relief to preserve his or her right or to prevent further damage until the case itself is heard. For example, if you start a lawsuit and the other party begins selling their assets because of the lawsuit, you may bring a Mareva Injunction which will, in effect, freeze the party’s assets so that he or she cannot continue dissipating their assets.
At Kamalie Law, we have years of experience commencing and defending various injunctions and ensuring our clients’ rights are preserved.
In short, yes.
While parties involved in a dispute will often want to have their ‘day in court’, the truth is that ‘court’ is rarely, if ever, just one day. Trials are lengthy and time-consuming, and can stretch out for days, weeks, or even months. This is why there are several imperative steps in the litigation process, such as case conferences and settlement conferences and mediation, which encourage parties to settle out of court.
Ultimately, litigation can be a helpful tool to resolve partnership disputes, but simply filing a claim does not automatically mean that a dispute will go to trial. Negotiation and other alternate dispute resolution measures can continue even after a claim has been filed. Further, an out-of-court settlement can bring a quick end to any court processes. In fact, once a lawsuit is commenced, only a small percentage of cases proceed to trial. Most cases settle outside the courtroom.
Partnership disputes can be difficult to resolve without a lawyer. Sometimes a solution will involve combing through the partnership agreement, doing case law research, bringing an urgent motion or having a degree of separation between the parties themselves.
A partnership dispute lawyer will help provide a rational and reasonable overview of the situation. At Kamalie Law, we offer experienced, strategic advice as professionals who not only know the law, but who have dealt with similar matters before and can offer perspective on your best chances of success. We will always look for ways to resolve a dispute early on. Where an early resolution is not possible, we will not hesitate to zealously advocate for you in court. Contact us today to set up a consultation.