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Avoiding business litigation due to partnership disputes

On Behalf of | Nov 3, 2016 | Business Litigation

Of all the decisions that need to be made when starting a business, one of the most important is selecting the type of legal structure for the company. Some of the most common forms of business are sole proprietorships, partnerships, corporations and S corporations. When one chooses to structure a business as a partnership, there may be times in the future when partnership disputes occur and business litigation may be looming. A 2015 article highlights some tips that may benefit those in Georgia by alleviating some of these issues.

One of the most important points made in the article is that it is much easier to deal with partnership problems on the front end, rather than when a business is established and partnership negotiations have ended. A key aspect of this is having an official and signed operating agreement. This should include a description of each partner’s role in the company, and how he or she will be compensated, both in the beginning and as the company evolves. The article suggests that the operating agreement should discuss what would occur in worst-case scenarios, even though this is not easy to do when the excitement of a new enterprise is at its peak.

The article also stresses the importance of securing personal legal representation. While there are many online sites that allow a hopeful business owner to draw up boilerplate operating agreements and other contracts, there is no substitute for the guidance of an experienced attorney. There are many factors that go into the creation of a new company, and even the brightest of entrepreneurs may not be able to anticipate all of the complexities.

Despite the best planning, business litigation due to partnership disputes can still occur. As a business grows and evolves, relationships can change and become strained over time. Those in Georgia facing these difficulties could benefit from discussing their unique situations with attorneys who are experienced in business litigation. This type of attorney will be in the best position to offer guidance and protect the best interests of his or her clients.

Source: Forbes, “How To Avoid A Partnership Dispute“, Shane Robinson, Accessed on Nov. 2, 2016


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