Sometimes breaking up is hard to do but very necessary. Business partners may start out with a healthy relationship but notice that the partnership no longer works. At that point, you might need to decide whether it’s time for a business divorce.
What Is Business Divorce?
What it’s not is the division of a business between spouses who are terminating their marriage. Instead, this type of divorce involves business partners who no longer wish to be business partners.
The process you use to finalize your business divorce will vary depending on the type of business arrangement you have. You and your business partners will have to make some tough decisions. But continuing a fractured business relationship can hurt the business more than dissolving it. You may also experience a great deal of stress along the way.
What Are Some Warning Signs?
You and your business partner might be trying to co-exist and keep your company running. However, you might notice signs that things are not going as well as expected:
- You start having daily struggles over daily operations.
- Your goals and vision for the company are no longer in sync.
- You learn that your partner is hiding things from you.
- Money or other business resources are disappearing or being misused.
- Your partner essentially abandons the business by refusing to show up for work or return your phone calls.
- You suspect that your partner is misusing intellectual property, including trade secrets.
Realizing that your partnership no longer works can be infuriating but talk to an attorney before taking any action.
What Can You Do?
If you feel a business divorce is looming in your future, here are some steps you can take:
Keep track of any concerning incidents.
Quietly explore your options.
Talk to an attorney about a strategy for dissolving the business.
Consider legal and tax issues related to ending the business.
What you should not do is confront your partner without having first obtained legal advice. Also, make sure that you do not break the law yourself. For example, Florida is a two-party consent state. This means that all parties must consent to have a conversation recorded.
Just as there are formalities to starting a business, there are certain steps you can take to end one. However, it’s important to understand the process of legally dissolving a partnership before making any moves.
Call an Experienced Business Lawyer for Your Business Divorce.
If you were divorcing a spouse, you would need advice from a lawyer specializing in family law. But if you are seeking a business divorce, you need a business attorney.
Attorney Richard Sierra at the Florida Small Business Center assists clients like you with business and litigation matters. As always, Our Goal Is to Help You Succeed™. For an appointment, you may call us at 1-866-842-5202 or use the contact form on our website. We represent clients throughout the State of Florida, including Coral Springs, Coconut Creek, Boca Raton, Delray Beach, Pompano Beach, Sunrise, Fort Lauderdale, Miami, West Palm Beach, Jupiter, Deerfield Beach, Stuart, Port St. Lucie, Orlando, Naples, Fort Myers, Sarasota, Tampa, and surrounding communities.