Business partnerships can be like marriages. Some last while others end up coming apart. When a business partnership is no longer viable, it can cause the business to suffer. It is important to recognize the need or desire to end a partnership and take adequate legal steps to end it in a timely manner. The way you go about trying to dissolve a partnership will in part determine how well your business will fare in the future. An experienced business law attorney will help you take the steps you need to end the partnership in a favorable manner.
Review the Contract
A business partnership is a legal contract between business owners. As such, you should always look to the contents of the contract to find out how to proceed. There should be guidelines included in the contract for situations that arise, such as when one partner wants to end the business arrangement. Always follow what the contract provides. However, there could be some instances in which the contract is silent on such matters or in which the contract is ambiguous. It is then that you will need to work within the general laws to determine how to cancel the partnership.
Discuss the Matter with Your Partner
One of the first steps you can take to dissolve a partnership is to talk to your business partner about it. You will want to discuss the reasons why you feel it is best to cancel the partnership and why it matters to the business going forward. Of course, in many cases, the relationship between partners has already degraded and a conversation might not be possible. In some cases, you may need to consider how much you are willing to pay your partner to buy out his or her portion of the company. Before you take further steps, it is wise to consult with a skilled business law attorney. You do not want to do anything that could make it more difficult to move forward and keep the business functioning properly.
Dissolve the Partnership
Dissolution of a business is governed in Wisconsin under the Uniform Partnership Act and other laws. The specific laws that apply are based on the type of partnership that you have. Generally, you will need to submit dissolution paperwork to legally end the partnership. Before you do so, make certain that you address all the many concerns that will apply to your situation. For example, you will need to know what type of business model the new business will fall under, how you will pay for outstanding debts, how you will be able to utilize the current name of the company, and many more issues.
Communicate With Employees and Customers
Once you are moving forward with a change in your business, you will need to communicate with your employees, customers, suppliers, and others. Allow plenty of time for everyone to make the necessary adjustments. Put a plan in place for employees and provide them with information regarding how the changes will impact their job and their benefits moving forward. Depending on how the business will continue to operate, it is best to reassure associates that the company is stable and the changes are being made to improve the business.
Changes to any business agreement can be complicated. Review the matter with a qualified business law attorney. To learn more about canceling business partnerships, contact our lawyers online at Moen Sheehan Meyer, Ltd. or call (608) 784-8310 to schedule a case consultation.