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Caring For Generations

Proactive steps to prevent partnership disputes

On Behalf of | Oct 9, 2019 | Business Law

Between any two people, no matter how much they agree on, there will be some things they see differently. When those two people are business partners in Indiana, the disagreement could lead to serious issues.

As Business News Daily notes, a disagreement may be about any aspect of the business, but many common disputes involve the allocation of finances, management and operations or the ownership of intellectual property.

Here are some suggestions from Forbes for how to keep partnership disputes from destroying the company.

Draw up a values agreement

Partners need to identify their own business philosophies, their management styles, the type of business culture they want their company to have and their leadership strategies. These should be matched up to see if there are any areas that cannot co-exist before creating the values agreement, which documents the partners’ ethical commitments to each other and to the company.

Create an operating agreement

This agreement should include, at minimum, detailed descriptions of each partner’s role, how they will be compensated and what liability protections they have.

Establish protocol for worst case scenarios

Coming up with all the things that could go wrong will not be the highlight of the company’s establishment, but it is a good way to come up with protocol for dealing with disastrous events. Discussing these in advance may help considerably in allowing partners to view the potential for disaster objectively and collaborate on solutions.

Consult a professional

The legal agreements and other documents that go into developing a successful partnership and addressing disputes should be tailored to the partners and to the company itself. DIY paperwork is not likely to cover all the bases.