Entering into a partnership to start a business with another person can be a life-altering choice. Obviously, drafting a thorough contract is in both of your best interests.
Unfortunately, not everyone who signs a contract will uphold their end of the agreement. What steps will you need to take if your partner has violated your partnership contract in a way that you feel is damaging to your relationship or the business?
Carefully review your partnership agreement
It’s important to make sure you haven’t misremembered the details of your agreement before you look to initiate a dispute with your business partner. The longer it’s been since you looked at the contract, the more likely it is that you may have inaccurate recollections about its contents.
Looking over your partnership contract in detail makes it easier for you to explain the issue to your partner and provide them with the specific steps you have to take to resolve the problem.
Have a sit-down conversation
Sometimes, what causes a partnership issue is a burnout. Other times, it’s assumptions that go unchecked. Your partner may have even have performance issues because of health concerns or problems in their marriage.
You won’t know the real source of the issue until you discuss the matter with your partner. You may be more amenable to resolving the issue if you have a better understanding of their concerns. You may have no choice but to pursue litigation if they don’t seem receptive to such communication.
Courts can enforce contracts and dissolve partnerships
A judge could order your business partner to carry out their responsibilities as per your agreement if they’ve failed to live up to their obligations as outlined in your partnership agreement. You might want to consider dissolving your partnership or buying your partner out if no other efforts seem to work.
Thinking carefully about your company’s future plans can give you some insight into whether you should pursue business litigation to address your serious partnership dispute.