When you started your business, it seemed as if the energy, enthusiasm and goodwill between you and your business partner would carry you far into success. In the initial stages of building a business together, you likely did not imagine that this person with whom you decided to build your livelihood could possibly betray you or commit any type of fraud against you.
Unfortunately, disputes among business partners are quite common and can lead to disastrous consequences for the business itself. If you suspect that your business partner is breaching your trust, you should not avoid your suspicions, but rather take decisive action to face the problem head-on.
Ways you can approach problems
Before things between you and your business partner deteriorate to the point of no return, you can take some steps to try to mitigate the damage and resolve the problem. The most important step in this stage is to approach the problem with an open and honest talk with your business partner. You need to get your concerns across in a way that is non-confrontational but also does not shy away from your suspicions.
In some cases, airing your grievances can clear up misunderstandings and pave the way to a resolution. In other cases, attempting to talk openly only ultimately leads to more disagreements and distrust, in which case you will need to take action.
Breach of fiduciary duty
Depending on the type of partnership, business partners have a fiduciary duty to the partnership. The particulars of this may vary depending on the specifics of the partnership, but if one partner breaches his or her fiduciary duty, there may be grounds for a lawsuit. In some cases, you can avoid a courtroom through alternative dispute resolution, such as arbitration or mediation, to resolve the issue. This type of resolution can save you both time and money, as lawsuits can drag on and become quite costly. However, other cases may be beyond the reach of an alternative solution, which requires going to court for a resolution.
One of the key things to keep in mind if you fear that your business partner is breaching your trust is to confront the problem as soon as your suspicions arise. Allowing the issue to continue without addressing it head on only leads to further suspicion and possible harm to the business. The sooner you take action, the better your chances of salvaging the business and possibly the partnership.