Partnership Dispute Lawyer Near Perrysburg, Ohio

Sawan & Sawan - Local Family-Owned Perrysburg Law Firm

Ohio Partnership Dispute Lawyers

Partnerships are agreements or arrangements between multiple people to engage in business together. Just like any part of life, disagreements can happen and if they cannot be resolved amongst the partners, these disagreements can escalate into full blown disputes. When a dispute happens within a business partnership, the partnership agreement itself will be the quintessential document governing what happens. States all have their own partnership laws such as those embodied in the Uniform Partnership Act or other nuanced rules. These usually only apply to the extent a partnership agreement does not exist or does not modify them. Partnership disputes can result in mediation, arbitration or even litigation. If the dispute is serious enough, it can result in the dissolution of the partnership.

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Common Causes of Partnership Disputes

Contract breaches occur most frequently in small partnerships. The disputes usually deal with ownership, management duties, decision-making, profits, and compensation. Also breach of fiduciary duties occurs when a partner violates her partnership obligations. These violations resolve around self dealing, lack of loyalty, or failure to consider the best interest of the partnership. Fraud also establishes breach of both fiduciary and contract claims. In addition, partnership disputes can arise where there are no clear roles and responsibilities, misaligned goals and expectations, lack of communication between the partners, financial differences, and uneven efforts or contribution to the partnership.

Partnership Agreements

Partnership agreements are contracts that are signed between two or more partners within a business. They outline the terms of the business relationship and how the business will be operating. The partnership agreement usually will discuss the roles, responsibilities, voting power over decisions and management and procedures to follow during a partnership dispute. It is important to account for the possibility of a dispute when forming the partnership by including the rules by which partners can withdraw from the business or dissolve it. The agreement may also include procedures regarding dispute resolution such as mandatory arbitration or mediation. This can prevent protracted and expensive litigation should a dispute arise.

Resolving Partnership Disputes

If the partners cannot agree on issues within the partnership, they may seek mediation for a resolution. In mediation, a neutral third party (mediator) engages with the partners and encourages conversations assisting them to mutually resolve their differences. If unsuccessful, the partners can turn to arbitration. At the arbitration hearing, the partners present their dispute and arbitrators decide the matter. As a last resort, the partners can litigate the matter at a trial. At any time, the partners can settle their dispute.

Partnership Dissolution

If a partnership dispute cannot be resolved, the business may need a forced dissolution. Most partnerships will have a provision within their partnership agreement regarding the rights of partners and the procedure by which the business is to be dissolved. State statutes will almost always give deference to any valid legally enforceable partnership agreement. If the partnership agreement does not address the dissolution, Statutes or court orders may fill in the gaps. The court can dissolve a partnership in various circumstances depending on the State law at issue. In such cases, a lawsuit will need to be filed and the court will hear the facts and evidence and make a ruling based on incapacity, misconduct, impracticability or other legal standards when granting or denying a dissolution request.

Damages in a Partnership Dispute

Damages in a partnership can vary greatly depending on the facts and circumstances of the individual case. It may take the form of damages one partner owes to the other partners or to the business itself. The partnership agreement may provide for damages in certain cases. It can be difficult to prove what damages naturally flowed from the breach of contract or fiduciary duty and this can require expert witnesses specializing in the particular business or economics at issue. There may be compensatory damages, specific performance, equitable adjustments, dissolution or even punitive damages. It all depends on the facts of your specific case and nature of the business involved.

Do I Need a Lawyer for a Partnership Dispute?

Lawyers and mediators are vital in assisting partnership differences. A lawyer provides legal advice to help the partnership to avoid conflicts. She can review and draft all contracts making sure it is in compliance with all laws. She can draft the contractual language with clarity so there is no misunderstanding between the partners. She can address disputes by mediation, negotiations, or litigation. Oftentimes, she enforces the partnership agreement and fiduciary duties. A mediator who is a neutral third party, can resolve disputes between the partners. She can find ways to resolve differences resulting in solutions. She can maintain the partnership relations during conflict. Mediation is also less costly than trial.
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Dennis P. Sawan

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Chris Sawan

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