Austin-based business lawyer Jack Zinda of the law firm Heselmeyer Zinda, PLLC offers some cogent advice for resolving partnership disputes.
Disagreements between business partners are often difficult to resolve. Many issues can emerge as conflicts. Contracts can be breached, business opportunities can be usurped, trade secrets can be stolen, or funds can be embezzled – with or without impunity. Resolving such conflicts can be time consuming, emotionally draining, and well, they cause stress or worse.
“It happens all too frequently,” says Austin-based business lawyer Jack Zinda of the law firm Heselmeyer Zinda, PLLC, “even the best intentioned business partners often find themselves disagreeing for a multitude of reasons.” Such disputes could arise from a failure to honor fiduciary duties, a failure to fulfill contractual obligations put forth in a partnership agreement, operating agreement or other business contract, trade libel, disparagement of goods or services, disputes among LLC members or perhaps by engaging in clandestine business dealings which don’t happen to coincide with the best interests of the company. “These disputes need to be resolved in an expedient manner. Sometimes an issue that’s arisen can be resolved internally, but most often they require legal help,” Zinda asserts.
If the dispute can’t be resolved internally, other options may surface, including the dreaded one – litigation. Owners of close-knit companies and small businesses will generally want their conflicts resolved as amicably as possible, so that they can return to servicing their customers. Negotiation, mediation, and arbitration are the best ways to avoid litigation. Through these conciliatory routes it’s often possible to arrive at a resolution made, if not in heaven, than in a netherworld that makes sense to all concerned. “When a dispute occurs, the business that you have worked to build and maintain can suddenly be placed in jeopardy,” Zinda explains, “Our goal is to truncate a crisis before it becomes a full-scale crisis.” Through alternative dispute-resolution procedures such as negotiation, mediation, and arbitration, it’s often possible to arrive at solutions that address a business partner’s integrity issues or decision-making authority while still preserving the infrastructure of your enterprise. “What you don’t want to do is throw your firm’s functioning ability out with the nasty bath water that’s been pooling in the office as a consequence of antagonism.”