Fort Worth Partnership Disputes Attorneys
Seeking Orderly Dissolution of Partnerships — Partnership Litigation Lawyers
When choosing a business structure, partnerships provide a popular choice especially for friends and family who decide to start a business together. Although partnerships offer the benefits of limited formalities, many principals in Fort Worth partnerships find that disputes between business partners can become a greater threat than the competition. When you recognize that you are becoming embroiled in a dispute with your business partner, you must take prompt action to safeguard your business and the equity interest built through diligent efforts. Fort Worth partnership dispute attorneys at FH Law Group assist small businesses and individuals in resolving litigation and crafting strategies to prevent future disagreements that can disrupt business and drain partners of critical financial resources.
Partnerships under Texas Law
The Texas Business Organizations Code along with your partnership agreement delineates the responsibilities and rights of all partners. Every limited partnership in Texas must have at least one limited partner and one general partner. Limited partners cap their personal liability for partnership debts at the amount of their personal investment in the business. However, this financial protection comes with a price. Limited partners do not participate in the management of the business. The general partner assumes all rights of control and management but does not benefit from limits on his or her personal liability for partnership debts.
Partners under Texas law owe each other a high level of fiduciary responsibility. This means that partners must act toward one another with a substantial degree of trust in all matters relating to their ownership rights and financial interests. The fiduciary responsibility of partners extends to ethical requirements, communications, and financial transactions.
Common Issues at the Core of Disagreements between Partners
If a dispute arises between partners that negatively impact operations of a business, sometimes the issue can be resolved amicably. When such efforts fail to resolve the problem, partners might have to turn to the judicial system to settle the conflict.
The best alternative for handling partner disagreements is to anticipate and defuse conflict before problems occur. Contentious disputes between partners can reduce profits or even cause a business to implode. Even with the most careful planning, issues can arise between partners, involving a wide range of matters that include:
- Misappropriation of funds
- Exercise of control
- Breach of contract
- Cash flow problems
- Division of business assets upon winding up
- Dissolution of the partnership
- Buyout and retirement issues
- Probate or divorce of a partner
- Breach of fiduciary duty
- Disputes over types and amounts of compensation owed to a partner
- Partnership tax issues
- Financial hardships stemming from a partner’s “personal life”
- Disagreement over business decisions
- Partnership Debts
Options for Resolving Partnership Issues
The attorneys at FH Law Group explore alternate dispute resolution (ADR) methods to mitigate animosity, cost, and disruption. When ADR approaches fall short in solving the problem, FH Law Group clients take comfort when full-scale litigation constitutes the best alternative for resolving a dispute because their attorneys have collectively taken over a hundred cases to trial.
When face-to-face negotiations in meetings fail to settle a dispute, arbitration or mediation might provide a viable option. Arbitration offers a way to rectify a disagreement without involving the courts. A neutral third-party gathers information from both partners, conducts an analysis, reviews the issues, and makes a decision on the resolution. The parties usually agree that the decision of the arbitrator will be binding on the parties. Mediation also involves a third-party (the mediator) considering information from both partners to facilitate the partners working out a resolution to the dispute.
If you and your partner(s) are unable to resolve a disagreement, our Fort Worth partnership dispute lawyers assist our clients in reaching efficient solutions. Contact FH Law Group today for a FREE consultation at (817) 697-4400 or visit our website.