Just as personal relationships breakdown, so too do professional relationships. However, partnership disputes within a business can have detrimental impacts on more than just the good feelings between individuals, and often threaten the integrity and prosperity of the entire company. Fraud, dishonesty, and disagreements over the allocation of resources are examples of what can come between business partners.
When problems do arise, it is important to attempt to work out any differences of opinion informally before seeking the help of a court. Attempting to resolve disagreements outside of court not only keeps costs down for all parties, but also provides a chance to resolve issues before the effects on both personal and professional relationships are irreparable. When a lawsuit is unavoidable, it is important to understand your rights as a business partner. The first thing to consider is the type of agreements that were entered upon by all parties involved. As is the case in other areas of law, the clarity – or lack thereof – of the contracts signed at the onset plays a large role in determining what rights each partner holds.
But what happens when the agreement between the partners is not clear? In California, partnerships are flexible, and this potential for ambiguity can cause major problems when partners find themselves in disagreement with one another. In fact, the courts may question whether there is even a partnership. The division of profits and losses, the distribution of responsibilities within the business, and the investment by each of the partners are some of the factors that contribute to the court’s assessment of a partnership.AtYadegar, Minoofar&Soleymani LLP, we are experienced in representing businesses during all stages of the legal process, and can help you maintain your assets during this tough time.