Dissolving a partnership can be messy business
April 20, 2017
Business partnerships are a tricky affair, not only because they make a business venture so innately personal, but also because they are one of the few business relationships that can legally exist without a written agreement.
Unfortunately, many partnerships hit the end of the road sooner or later, which can make for immense frustration for partners, especially if there is a disagreement about the terms of dissolution. For many partners, the difficulties of business create personal tensions that are make objectivity hard to maintain.
Whether you want to dissolve a partnership that does not have an existing agreement with terms for dissolution, or circumstances have made your agreement untenable and you need help finding a fair way out, it is always wise to seek professional legal guidance.
Here in New Jersey, many partnership dissolutions threaten precious personal relationships, because we are a passionately communal region. If you are hoping to dissolve your business partnership and salvage a vital friendship, do not hesitate to speak with an experienced attorney who can help you weather this “business divorce.”
Dissolving a partnership requires a fair, professional approach
In order to begin the process of dissolving your partnership, first, you must determine whether or not your partnership features a written agreement that states terms of dissolution. If it does, then you should review the terms with legal counsel to ensure that the terms are met, or identify elements of the agreement that may need negotiating.
Of course, it is rarely if ever advisable to dissolve a partnership without discussing the matter with your partner. Even if the relationship has deteriorated immensely, it is important to come to an acceptable agreement on how you will exit the business. This is not only a good practice from person to person, it helps you avoid future legal trouble if your partner chooses to pursue action against you.
If your relationship with your partner is tense or even feels irretrievable, the guidance of an attorney can help you both remove emotion from the process and negotiate an exit strategy that is fair and equitable for both of you.
It pays to dissolve properly
While you might not technically need to file dissolution papers, it is always smart to finish things off officially. This helps protect you from some future legal threats, and adds a layer of official finality.
It is also important to notify others involved in your business, such as vendors or a landlord, of the dissolution. Also, be sure to close out all of the relevant accounts for the business and make sure both partners know that you’ve closed them.
Don’t do it alone
It is always wise to close out this chapter of your personal and professional life with proper legal guidance. An experienced attorney can help ensure that your rights remain protected as you chart a path to a new season of life.