Involved In A Partnership Dispute? A Revised Partnership Agreement May Be An Option
A dispute with your business partner can cause significant damage to your underlying business. It can also cost you a lot in terms of time, personal expense, and stress. As a general rule, it is advised that business partners locked in a dispute carefully consider every available option for a low conflict, collaborative resolution. A revised partnership agreement may be the best path forward for you and your business. In this article, our West Palm Beach partnership lawyer explains how a revised partnership agreement is a potential option to resolve a dispute.
A Partnership Dispute Can Cause Serious Damage to a Business
To reach its full potential, a business generally needs decision-makers that are on the same page. A dispute between business partners can be especially destructive for a business. Here are some of the most notable concerns:
- Erosion of Trust Between the Parties: A partnership dispute can erode the fundamental trust between partners, which is vital for the smooth operation of a business. Once trust is compromised, it becomes challenging to make unified decisions, leading to inefficiency and stagnation.
- Adverse Financial Repercussions: Disputes often lead to financial instability. It can be in the form of legal fees if the dispute escalates to litigation, or loss of business due to the inability to make prompt, effective decisions.
- Loss of Focus/Decision-Making Ability: Disputes can be time-consuming, diverting attention away from the primary goal of business growth. They can monopolize the time and energy of partners, reducing their focus on strategic planning and execution.
Why a Revised Partnership Agreement Can Offer a Potential Solution to a Dispute
For a number of different reasons, collaborative solutions can be effective ways to resolve partnership disputes in Florida—especially if the parties want to continue operating the business. A revised partnership agreement is often a viable option. Here are some notable advantages:
- Clarification of Roles and Responsibilities: A dispute may arise over different views of how the business should operate. A revised partnership agreement can provide clarity on each partner’s roles, responsibilities, and decision-making authority. This can prevent misunderstandings and potential conflicts.
- The Setting of New Dispute Resolution Mechanisms: A well-structured agreement can establish a dispute resolution mechanism. Among other things, you may want to consider a provision regarding arbitration or mediation, thereby avoiding costly and time-consuming litigation.
- Adjustments for Change in Circumstances: Your original partnership agreement may no longer be fully applicable. Businesses evolve, and so do the circumstances of the partners. A revised partnership agreement can incorporate these changes, ensuring the agreement remains relevant and practical.
Contact Our West Palm Beach Partnership Dispute Attorneys Today
At Pike & Lustig, LLP, our West Palm Beach partnership law attorneys are skilled, attentive, and solutions-forward advocates for clients. If you have any questions about partnership disputes and revised partnership agreements, we are here to help. Contact our commercial litigation team today for a completely confidential consultation. Our firm serves clients throughout South Florida.