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Disagreement in business partnerships

September 11, 2019
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Disagreements in business partnership
Dispute resolution
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How to manage business partner disagreements effectively

Running a business is a tough but rewarding exercise. There are so many things to manage and a great deal of responsibility, especially if you have employees. One way that many people like to mitigate the pressures of responsibility is by entering into a business partnership. A business partnership is a business structure whereby two or more people share responsibility for running a business. Each partner is jointly liable for all business dealings.

While a business partnership can be a hugely rewarding endeavour, you need to ensure that you have an effective method of resolving any business disputes. Effective dispute management is key to ensuring that personal or financial matters do not come between your business and its success.

AANDI Lawyers has experience and skill in managing disagreements in business partnerships. Contact us today to discuss your business disagreement and find out how we can help.

Do you have a partnership agreement in place?

partnership agreement

A key factor in the successful resolution of disputes is having a formal partnership agreement in place. This is a document that is drafted when a partnership is established, often before any tensions arise. A partnership agreement will outline how disagreements are to be resolved and will stipulate the roles and responsibilities of each partner. Such an agreement can also provide clear guidelines for managing disputes, and what to do if you wish to dissolve the partnership.

  • If you have a partnership agreement, set about following the steps outlined if a dispute arises.
  • Relying on your partnership agreement can be a straightforward way to resolve disagreements without acrimony.

Don't have a partnership agreement? No problem - you have plenty of other options to follow when looking to resolve a dispute.

Work out the true issues in your partnership dispute

In many cases a partnership dispute will be straightforward. One partner might be doing more work, or spending more money, or committing more time. In this instance you need to resolve your dispute so that responsibilities are distributed fairly.

  • Sometimes a dispute might seem to be about one thing, when it is actually about another deeper issue which is being masked by a more superficial issue.
  • In this instance you do need to be honest with the partners in the business and seek a resolution for the good of your business.

Work out the ideal outcome for business partner disagreements (and identify your best alternative outcome)

While it would be great if both parties saw eye to eye and could work out the ideal resolution to an issue, the fact is that sometimes people cannot agree. If this is the case with your dispute it can be helpful to identify the best case scenario outcome and then your best alternative outcome.

[content_aside]For example, you may have a dispute about one partner not coming into the office five days a week as agreed at the start of the business. They have other commitments with family and have only been coming in one day a week. While you would ideally like to see them in the office five days a week, you reach an agreement where they come in to the office three days a week, with two days working at home.[/content_aside]

Identifying the key factors in your dispute is essential. Take some time to write down the factors that are an issue and be prepared to speak beyond your dispute and talk about the broader business values as a whole. Raise any additional issues in a meeting between the partners and be prepared to negotiate to achieve the best possible outcome.

Read more: Resolving a small business dispute without going to court

Put your agreement in writing

business partnership in writing

When you have worked out something that you are satisfied with, be sure to put it down in writing. You may like to formalise this in your partnership agreement (if you have one) or use this as an opportunity to develop an agreement moving forward. If you cannot resolve your dispute between the partners it is possible to engage the services of a professional dispute resolution lawyer.

Engage a professional

When a dispute is not able to solved between the partners a lawyer with experience in negotiation and dispute resolution can provide a valuable service.

  • A dispute resolution lawyer allows you to step away from the role of mediator and lets an impartial third party manage the positions and interest of the partners to the dispute.
  • A dispute resolution professional can look from the outside and identify your rights and obligations and provide clarity when judgement may be clouded.

Contact AANDI Lawyers Today

For assistance with resolving a disagreement in business partnerships contact AANDI Lawyers. Our dispute management professionals can help you to resolve your partnership dispute with dignity and efficiency, while helping your business to achieve a productive and positive outcome.

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