When you started a business, you always knew that one business litigation case could be enough to bring your business to its knees. However, you did not expect the litigation to come from your Burlingame business partner.
Many partnership disputes come about because there was an inadequate partnership agreement when the business was started. As much as you may trust someone you start a company with, you need to lay down the details in a partnership agreement to avoid disputes later. These are some things you should include:
- The percentage of shares each of you owns.
- How you will pay out profits and dividends.
- How long the partnership is for.
- How you can end your partnership.
- What happens if the company needs more investment.
- What happens if one partner wants to sell their part.
- What responsibilities each of you has.
- What you will each input.
If you are in a legal dispute with your business partner and made a partnership agreement when you started, refer to it. You may have written down provisions to deal with your current situation. For example, your business partner has had a lucrative offer for his shares and wants to sell. You do not want to be in business with the person who has made the offer. If your agreement stipulated shares may only be offered with the other partner’s approval, you could block the sale.
Whether you made a partnership agreement or not, you will still need the representation of a Burlingame lawyer. They can help you make sure your disagreement does not damage your company.