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Partnership Disputes

If you need help resolving a partnership dispute, we can help. Glanvilles’ commercial team has a proven track record in helping directors, entrepreneurs, shareholders, and companies with resolving partnership disputes.

Like all relationships, a business partnership can succumb to pressure and become strained over time. Often caused by financial difficulties, lack of direction, differing expectations or unequal effort and interest, disagreements can easily flare into acrimonious conflict, resulting in bitter disputes and business jeopardy.

Whether you are an exiting or remaining partner, we can help to prevent, manage and resolve partnership disputes as quickly, efficiently and amicably as possible.

Our expert commercial team have wide experience in negotiation and mediation, advising and representing all types of businesses involved in partnership disputes in Chichester, Fareham, Havant and across the wider Hampshire and West Sussex areas. 

Our partnership dispute advice and representation covers:

  • Rights and obligations of partners
  • Performance issues
  • Partner misconduct
  • The suspension or removal of a partner
  • Partner liability
  • Breaches of duty
  • Breaches of Partnership Agreement terms
  • Fraud
  • Discrimination
  • Dissolving or winding up a partnership
  • Terminating an individual partnership and retirement
  • Business partnership disputes
  • Mediation

We work with all types of partnerships across a variety of professions and sectors, giving bespoke advice and representation for achieving a positive outcome.

Our team can also provide general advice on partnership formation, conversion, disputes or dissolution, drafting all the necessary documentation and agreements to protect your business partnership and secure your individual partner rights.

Get in touch for partnership dispute legal advice

Give us a call at your local branch in ChichesterFareham or Havant or fill in our simple online enquiry form for a quick response.

Why choose our partnership disputes solicitors?

We know that a partnership dispute can be extremely damaging to your business and professional reputation alike. It can pose significant long-term risk to your business survival, undermine day-to-day operations, or harm the careers of those involved.

Where big investments have been made in terms of the time, emotion, and money, tensions can easily escalate into highly sensitive and deeply personal conflicts.

For these reasons, our expert partnership dispute solicitors will always aim to help you resolve your dispute quickly and amicably, before resorting to lengthy and costly litigation.

Glanvilles’ business dispute solicitors have extensive experience and an excellent record of success in the use of mediation as an effective tool in resolving partnership disputes.

Our partnership dispute solicitors understand the legal, commercial, and regulatory framework that partnerships operate in. This enables us to provide clear, straightforward, and practical advice to strengthen your position with expert mediation, negotiation or litigation.

We will help you to take commercially astute, decisive action that protects your business reputation and secures your long-term commercial success.

Our expert team includes Partner Lance Terry, an experienced lawyer with a strong background dealing with corporate matters, including partnerships. He also provides a range of associated commercial law advice to help businesses make their commercial ventures a success, including contracts and intellectual property advice.

Our Corporate team also includes Scott Richardson, a skilled lawyer who specialises in all corporate and commercial law matters. If you are an entrepreneur, start-up, or early-stage business in or around Chichester, Scott is available to provide a free 30-minute consultation to discuss your legal requirements. Get in touch with Scott at scott.richardson@glanvilles.co.uk.

The Glanvilles’ client service promise

When you use our partnership dispute resolution service, we promise:

  • Our staff will be friendly, respectful, and attentive
  • Your concerns will be listened to, your questions answered, and your options explained in plain English
  • The cost of dealing with your requirements will be made clear to you from the outset
  • We will answer your phone calls and emails promptly
  • We will keep you regularly updated at all times

The Glanvilles guide to partnership disputes

What is a business partnership?

A business partnership is a type of business entity whereby two or more parties join forces, agreeing to run and manage a profitable business enterprise together. There can be different types of business partnerships such as:

General Partnerships – A business arrangement between two or more parties who carry out a business to share profits and liabilities, but in this case it is not a separate legal entity as each partner’s share of the profits will be taxed as personal income.

Limited Partnerships – A business partnership formed as a legal entity under the Limited Partnership Act of 1907 where there are one of more “general partners” along with one of more “limited partners”.

Limited Liability Partnerships (LLPs) – Similar to a standard partnership but with reduced personal risk and responsibility for business debts for individual partners. The LLP is a separate legal entity that is responsible for liabilities rather than the partners. A Members’ Agreement will govern the relationship between members. Where there is no agreement in place, the Limited Liability Partnership Act 2000 will apply to the LLP.

When you are operating a business with someone else or other people to make a profit, you are already in a partnership.

To avoid potential partnership disputes and secure the best chance of success for you and your business, it is always a good idea to draw up a partnership agreement which will set out clear terms and expectations right from the outset.

What is a partnership agreement?

A partnership agreement is a formal contract between two or more parties to form a business partnership.

Other terms to describe a partnership agreement are General Partnership Agreement, Business Partnership Agreement and Partnership Contract.

A partnership agreement will set out important issues such as the rights and responsibilities of each partner and how profits and losses should be shared.

How do you resolve disputes in a business partnership?

Like all relationships, business partnerships can also break down. Differing opinions on how the business should be run can quickly spiral into acrimonious disputes that can bring about a bitter end to a partnership.

But before any disagreement gets out of hand, we recommend that you begin by reviewing matters to determine whether things can be resolved amicably, without the need for expensive and time-consuming litigation.

In the first instance, it is always a good idea to consult your partnership agreement which may set out the policies and procedures to follow in order to reach a quick and amicable resolution to disagreements.

However, should you feel that the only course of action is to bring the partnership to an end, keeping things as civil and cordial as possible will be helpful if you are to avoid litigation.

Your partnership agreement will typically set out the process that needs to be followed in order to dissolve your partnership. This may include mediation as a means of resolving a dispute which may be helpful in reaching better terms or a reconciliation, if this is at all possible under the circumstances.

Can you make your business partner buy you out?

Business partnerships end for all sorts of reasons. Business partners, like the businesses they run, rarely stay the same and will inevitably change over time. Exposure to new ideas, challenges and opportunities can bring about differing opinions where tensions, divergence and conflict arise.

If you are a business partner in the position of wanting to leave a business partnership, but your business partner has not offered to buy your shares or interests, you may be wondering if you can force your business partner to buy you out.

With a partnership agreement in place, it will depend entirely on the terms of the agreement if, how and when this will be possible.

Without a partnership agreement, your partnership will be governed by the Partnership Act 1890 where, theoretically, you will be unable to make your business partner buy you out.

Instead, you could serve a notice of dissolution as an alternative method of bringing an end to the partnership.

In the absence of a partnership agreement, the Partnership Act 1890 will set out the process for dissolving the business and how any assets and liabilities will be dealt with.

Where this is the case, we will be able to help you interpret and apply the Partnership Act to your particular situation and circumstances.

How do you dissolve a business partnership?

The legal relationship between partners in a business partnership will be set out and governed by the partnership agreement, where one exists.

Where there is a partnership agreement:

  • Partners can agree to bring an end to the partnership by a specific date or on the completion of certain tasks.
  • Removal of a partner will only be allowed with express provision in the partnership agreement.
  • The process of removing a partner will be set out along with the amount and terms of compensation to be paid.
  • The partnership will be protected from an essential partner leaving, meaning a withdrawing partner may be liable for any potential damages suffered to the business or remaining partners as a result of their exit.
  • Unless a partnership agreement stipulates otherwise, a partnership may end because of the bankruptcy or death of one of the partners.
  • A partner wishing to dissolve a partnership must secure a majority vote among the other partners. Applications can be made to the court for a dissolution order where a partner cannot achieve a majority vote. Grounds for this are limited but can include:
    • Where a partner is permanently unable to perform partnership duties. 
    • The conduct of a partner has prejudiced the partnership business.
    • A partner makes persistent and deliberate breaches of the partnership agreement.
    • Where the partnership can only be run at a loss.
    • Where the court agrees that the partnership should be dissolved.

When an application for an order of dissolution is made to the courts, company records and evidence may be useful in support of an application. This might include records of partnership meetings, letters outlining concerns or even witness evidence.

Where there is no partnership agreement in place, the Partnership Act 1890 will apply. In this case:

  • A partner can make a written request to other partners to have themselves withdrawn from the partnership.
  • You will be unable to remove a partner from the partnership so would have to end the partnership instead.
  • The actions, decisions and behaviour of all partners will be binding on the business.
  • All partners will be jointly liable for the professional misconduct and debts of other partners.
  • All partners will have equal say and power to manage and run the business which can result in prolonged unresolved disputes.
  • One party can give written notice to other partners of their intention to dissolve the partnership, bringing it to an end at any time.
  • The partnership will automatically be dissolved on the death of a partner.

If you end up in the default position of your business being governed by the provisions of the Partnership Act, it could (for the reasons outlined above) have a potentially devastating and detrimental impact on your business.

Unfortunately, many businesses, such as family owned ones, still operate without a partnership agreement in place which can be a costly mistake in the event that difficulties and disagreements arise.

Where a partnership is dissolved, it is the responsibility of partners to wind up the affairs of the business, settling debts and liabilities and distribute assets between partners. Doing this incorrectly could give rise to claims and disputes between partners, especially where joint assets are still in use.

We can provide specialist partnership dispute advice, mediation and representation for businesses, company directors, shareholders, and entrepreneurs.

Get in touch with us for business partnership disputes legal advice

Give us a call at your local branch in ChichesterFareham or Havant or fill in our simple online enquiry form for a quick response.