A partnership dispute can arise when business partners or members of an LLP disagree over operational or financial decisions. Whereas many business vehicles have a clear hierarchy of who has final say over decisions and disputes, the equality of a partnership makes it a more complex area. The far-reaching consequences of partnership disputes mean it is essential for those involved to seek external legal advice on the best way to proceed.

Consequences of partnership disputes

In addition to partnership tax issues, property matters or disagreements over the day-to-day running of the business, one of the most common reasons for a partnership dispute to arise is that partners feel their contributions are not equal. Ralli Partnership Law can help you resolve these issues.

If disputes cannot be resolved they may lead to the dissolution of a partnership, which in effect means the end of the business. Alternatively, the expulsion or removal of a partner is sometimes an option if other partners want the business to continue.

In any case, it is essential that a partnership agreement is drawn up to cover the potential consequences of a dispute between partners or members. Without an agreement, you cannot expel a partner or member, adjust the distribution of profits, or continue the partnership if one partner serves notice of dissolution. Any solid partnership agreement will contain specific measures for mediation or arbitration in a dispute.

Employment rights in a dispute

It is important to bear in mind that in some cases, salaried partners or members of an LLP actually have ’employee’ status and therefore different employment rights. Issues of unfair dismissal or discrimination could arise which may be dealt with by an employment tribunal and could result in substantial compensation awards.

Partnership dispute resolution

Ralli’s team of expert partnership dispute solicitors offer advice on disagreements and problems. We also strive to achieve partnership dispute resolution with the best outcome for you and your business, whether by providing mediation between parties, or assisting in the dissolution of a partnership. Contact us today on 0161 832 6131 for advice on the best way to handle your dispute.

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