Disputes between business partners happen far more often than most people would think. Why? Because, although starting a business with someone can be a very exciting endeavor, in business, as in life, sometimes things do not go as planned. When the future of a business is at stake, disagreements are dramatically amplified and can cause a lot of damage. This is why, when setting up a partnership, it is vital to consider dispute resolution methods. In this article, you will learn about the best ways to resolve disputes between business partners in Florida directly from an experienced Florida Business Litigation Lawyer.
Resolving Disputes Between Business Partners – What You Need to Know
No matter how small a business is, its partners should have a written agreement that establishes the rules under which the business will operate to avoid stressful, time-consuming, and expensive disputes in the event they decide, for example, to dissolve the partnership. Running a partnership without such agreement means relying exclusively on the business’s structure, the revenue generated, and the desires of the partners to determine what the future of the business should be, which is not ideal.
If a particular business is generating significant revenue, and one of the partners wishes to retain their ownership interest, their best course of action may be to try to negotiate a buyout with the other partners. However, if they cannot come to an agreement, the partner who wishes to retain their interest may need to consider seeking direct legal action against the other partners.
On the other hand, if the business is not generating significant revenue or a partner wishes to dissolve the business, they should first try to get the remaining partners to agree to dissolve the partnership. However, if the other partners do not agree, then seeking the dissolution of the partnership in court would be the next logical step.
This is, however, not the best way to resolve any dispute. Litigation is time-consuming, expensive, and can cause a lot of damage to a business, its partners, and their relationship. Sometimes, litigation is simply the only option. However, often, there are better alternatives. When it comes to resolving disputes between business partners, businesses should always try to use the strategy that causes the lowest amount of damage. To do this properly, businesses should work with an experienced Florida Business Attorney who knows how to handle disputes.
The Best Ways to Resolve Disputes Between Business Partners
When a business dispute is resolved through mediation, the disputing business partners hire a neutral third party, known as a mediator, and discuss the issue in order to, ideally, reach a non-binding and voluntary agreement. If the disputing partners simply do not wish to communicate with each other directly, they may choose to go through the mediation process from different locations.
This dispute resolution method is one of the best available, as it is both a “stronger” version of mediation and a less expensive and considerably faster version of litigation. The crucial difference between mediation and arbitration is that the outcome of arbitration is generally final and binding, although this depends on the arbitration agreement signed by the disputing partners. When a dispute is resolved through arbitration, a neutral arbitrator hears both sides of the story and makes a final decision regarding the dispute.
This is the most complex, expensive, and time-consuming way to resolve disputes between business partners. Although no one ever wants to see the inside of a courtroom, sometimes litigation is the only way to successfully resolve a business dispute. Of course, when a dispute is resolved through litigation, it is vital to work with an experienced litigation attorney.
Are you in the middle of a dispute between business partners? Give Attorney Romy B. Jurado a call today at (305) 921-0976 or send an email to Romy@JuradoLawFirm.com to schedule a consultation. Do not let a dispute destroy your business.