In California and across the country, business partnerships are often compared to marriages. They include many similar characteristics in the way partners run the business together, and they may end in civil litigation if the partners are no longer able to get along. Just as one marital partner’s actions can cause broken trust between spouses, so too can the actions of a business partner breach the verbal or written agreement the partners share.
There are several options for business owners when one partner creates a serious breach of their partnership contract. Ideally, the partners have a written agreement that outlines how the members will deal with a partner who has broken the agreement. This may include the option to expel the violating partner. Without a written agreement that allows for expulsion, the remaining partners would be forced to create a new partnership without the member they want to expel.
A breach of partnership agreement that damages the business may deserve compensation. It may be possible to settle with a partner for an agreed upon amount of damages. A partnership agreement with clearly defined rules for this contingency can be of great benefit. In some cases, however, the remaining partners may have to take the matter to mediation or to court to obtain a fair settlement from a partner who has breached the agreement.
With a written partnership contract, enforcing the terms upon which partners have agreed may be easier. However, with the right legal assistance, business owners can obtain a clear picture of the best-case scenario and work toward that goal in the most efficient and cost-effect manner. A California attorney with experience in civil litigation can provide strong support in these situations.
