People who join together in a business venture typically have some common ground – at least in the beginning. After working together for a time, your partnership may get a little shaky. When an employer-employee relationship goes south, the employer may fire the employee. However, your partner is a co-owner, not your employee. If your partnership is having serious problems, how can you fire a business partner? There are several ways you can end this type of business entity.
Florida Partnership Laws
Under Florida law, a partnership is a distinct entity that is separate from its partners. Partnership is defined as “an association of two or more persons to carry on as co-owners a business for profit…”
The law also provides ways for a partner to dissociate from a partnership. More importantly for this article, Section 620.8601 of the 2019 Florida statutes sets forth events that can lead to a partner’s dissociation, including but not limited to, the following:
- The partner has provided notice of withdrawal from the partnership;
- An event occurred that causes the separation based on the terms of the partnership agreement;
- The other partners vote unanimously to expel the partner under certain circumstances;
- A court determines that the partner should be expelled;
- The partner files bankruptcy or needs a guardian or conservator.
Partnership law is complicated. It’s not possible to explain every nuance without knowing the particular details of your situation. If you have trouble with a business partner, contact a Florida business attorney as soon as possible.
Look to Your Partnership Agreement
If your relationship with a business partner becomes strained, check your partnership agreement. This agreement should have been one of the first documents you and your partners signed as you formed your business partnership.
A partnership agreement may set out:
- The duties and responsibilities of each partner,
- How contributions are made to the partnership,
- How distributions are made to partners, and
- Methods of handling disputes and/or ending the partnership.
Statistics show that up to 70% of business partnerships fail at some point. This shocking number highlights the importance of having a comprehensive partnership agreement and the importance of having the agreement drawn up by an attorney.
Call to Learn More About Business Partner Issues
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 tm. For an appointment, you may call us at 1-866-842-5202 or use the contact form on our website. we represent clients throughout South Florida, including Coral Springs, Coconut Creek, Boca Raton, Delray Beach, Pompano Beach, Sunrise, Fort Lauderdale, Miami, and surrounding communities.