No business owner goes into a partnership expecting it to fail—but the sad fact is many partnerships do break down. While there are many reasons why this can happen, there are some common themes. Our Seattle business litigation attorneys break down some of the most common reasons for partnership dissolution and offer advice on what you can do to protect yourself.
Reasons Why Partnerships Fail
There are many reasons why business partnerships can break down. Some of the most common include:
- One partner repeatedly fails to uphold their end of the bargain. This could be anything from failing to contribute their fair share of capital to not pulling their weight in day-to-day work.
- Dissatisfaction with the decision-making process. Perhaps one partner feels like they're not given enough input or that major decisions are being made without their knowledge.
- One partner begins to act aggressively or inappropriately toward the other. This can be anything from verbal abuse to harassment.
- One partner becomes increasingly challenging to work with. This could be due to substance abuse, mental health problems, or personality clashes.
Warning Signs That Your Partnership Is Headed for a Breakup
Of course, it's not always possible to prevent a partnership from breaking down—but there are some warning signs you can look out for that may indicate that your partnership is in trouble. These include:
- Your communication has become more negative than positive. If you constantly argue with your partner or nitpick their every move.
- You're no longer on the same page as your partner regarding business decisions. If you can't seem to agree on anything, it may be time to call it quits.
- You're no longer sharing the same vision for the business. Perhaps your partner has started putting pressure on you to change the company's direction in a way you're uncomfortable with.
- You no longer trust your partner. Whether they've been acting secretive or unreliable, a lack of trust is a recipe for disaster in any relationship—business or otherwise.
What You Can Do To Prepare for a Business Partnership Breakup
If you're worried that your business partnership may be heading for a breakup, there are some things you can do to protect yourself. These include:
Get Everything in Writing
If you don't have a partnership agreement, now is the time to get one. This document should spell out each partner's roles and responsibilities and what will happen if the partnership dissolves.
Keep Good Records
Make sure to keep meticulous records of everything—from expenses and revenue to communication between you and your partner. This will be invaluable if you ever need to go to court.
Be Honest with Yourself
If you're honest with yourself, you'll be able to see the warning signs before it's too late. If things are really bad, it may be best to call it quits before the partnership does irreparable damage to your business—and your mental health.
Consult with an attorney
If you're facing a business partnership breakup, it's crucial to have an experienced business litigation lawyer on your side. At Northwest Business Law LLC, our Seattle business lawyers have extensive experience handling all types of business disputes—including those involving partnerships. We can help you protect your interests and work toward a resolution that is in your best
Contact our Seattle business litigation attorneys today at (206) 565-0090 to schedule a consultation!