Skip to Content
DuBose Miller mobile logo

What Are the Most Common Types of Partnership Disputes and How Can I Avoid a Partnership Dispute?

April 29, 2022 Business Injury

A business will benefit from each partner’s diverse skills and expertise by operating as a partnership. Unfortunately, the benefits sometimes come at a cost. The potential for conflict in a partnership can be highly destructive.

The business injury lawyers from DuBose Miller in Atlanta have seen the damage partnership disputes can cause a company and have developed some strategies for avoiding these disputes or minimizing the impact of a partnership dispute. 

Many disputes share common causes. Read on to learn about some common partnership disputes and how to keep them from ruining your business.

Types of Partnership Disputes

Like all relationships, partnerships involve individuals who can disagree about nearly anything. Whether a dispute involves a legitimate complaint regarding wrongdoing or a difference of opinion regarding operations, it can be helpful to consult a business law attorney as soon as a conflict arises to help resolve the dispute before it can affect the bottom line.

Some common causes of partnership disputes include:

  • Fraud/breach of fiduciary duty
  • Uneven workload
  • Misusing or revealing trade secrets/confidential information
  • Disagreement about the allocation of resources
  • Breach of contract

In a situation involving illegal conduct, such as misappropriation of company funds, one party to the dispute will clearly be in the wrong. Other times, however, a partnership dispute may not be a question of right or wrong but a disagreement about how to best serve the interests of business. Working through the dispute with a skilled legal advisor could provide an efficient resolution.

Preventing Partnership Disputes

It is wise to establish a framework for resolving conflict from the start of a partnership relationship. A thoughtfully constructed partnership agreement can spell out the parties’ obligations and provide procedures for handling the situation when one party fails to live up to responsibilities.

The agreement could also specify how a dispute will be resolved when parties disagree over operating procedures, allocation of resources, and other business decisions. For instance, the agreement might allow for questions to be put to a vote of the management team or nominate an individual to serve as a tiebreaker. A partnership agreement might also call for mediation or binding arbitration in certain situations.

Ideally, the partnership agreement will define operations in a manner that lives up to the partners’ expectations so that few serious disputes arise in the first place.

An Experienced Atlanta Business Injury Lawyer Could Work to Prevent Partnership Disputes

The key to preventing and minimizing the impact of partnership disputes is a partnership agreement custom-tailored to meet the needs of the business as well as the personalities and circumstances of the partners themselves. For example, if partners have different goals regarding the length of their involvement in the business, the partnership agreement can be crafted to prepare for the smooth departure of one partner. 

The experienced Atlanta business injury lawyers at DuBose Miller can create a partnership agreement specifically designed to avoid partnership disputes and to provide for the speedy resolution of any disagreements. For more information about how our seasoned business law attorneys could work to prepare your partnership for the future, contact our office today.