Recent partnership dispute case studies
Partnership dispute case studies
As well as setting up partnership structures we also have extensive experience in resolving disputes between business partners. We have listed some of our recent cases with partnerships/LLPs below.
Dissolving a partnership with no written agreement
We acted for one of 2 equal partners, who had fallen out. There was no written partnership agreement. The other partner was refusing to address the problem or to take any steps to wind up the partnership. We advised our client how to terminate the partnership by notice and then used the threat of court proceedings to compel the other partner to cooperate in an orderly winding up of the business.
Avoiding liability for previous partners
Our clients were members of a professional partnership, whose membership had changed over the years. The Pensions Regulator wrote to our clients demanding a substantial sum in pension contributions for a former employee. We made the Pensions Regulator withdraw the claim by showing that all of the current partners had joined after the employee had left and so could not be liable for her pension contributions, as the debt predated their membership of the firm.
Securing a fair payout for a retiring partner
We acted for a professional retiring from her firm, which was a limited liability partnership (LLP). There is no LLP agreement and so no agreement on how a retiring partner should be repaid their capital. The other members had a good case that she would not be entitled to payment for her share of the firm. However we negotiated a payment of full value by taking a collaborative but strong approach.
Enforcing restrictive covenants against a partner
We acted for a professional partnership with restrictions in the partnership agreement against competition for 3 years after leaving the firm. A partner had left and was about to join a competitor. We wrote demanding that the partner comply with his non-compete obligations. He argued that they were too long, based on the reasonableness of covenants for employees, and that he had effectively been an employee. We threatened to issue a claim for an injunction on the basis that he was a partner not an employee and 3 years was reasonable for a partner where the goodwill of the business was involved. The partner agreed to comply with the restriction.
Overcoming the problem of no written partnership
We acted for a theatrical production partnership breakdown. The resolution we achieved was agreement on the sale of assets to respective partners. There was no written partnership agreement.
Media partnership mediation to resolve dispute
We acted for a media partnership mediation. We resolved the dispute between the parties through low-cost mediation.
Partner running a separate business in competition
We worked with an accountancy firm. The partners wanted to remove another partner suspected of trading independently and diverting profits. The written partnership agreement was old, out-of-date, and so removing the partner was difficult. We also modernised the partnership agreement to prevent the same issue cropping up in the future.
Partner leaving a hedge fund
We represented a partner in a limited liability partnership (LLP) hedge fund. The partner wanted to leave and came to us for negotiation to secure his share of carried interest and his share of goodwill.
Partner leaves management consultancy LLP on good terms
Our client, a partner, was joining a competitor. We carefully planned and negotiated his exit so the consultancy did not seek an injunction to prevent him competing.
Accountancy firm manager
We managed the turf wars and fall-out following the merger of two accountancy firms.
Architect’s departure to another larger firm
Our client was given responsibility for a foreign office of a larger firm. We advised a method for calculating the partnership share, and the foreign office’s funding, without impacting our client’s profit share.
If you need legal advice on a dispute with business partners, we have deep experience as you will have seen from the above. We also focus on commercial solutions. Get in touch to discuss your situation with our specialist lawyers.
An excellent grasp of the legal and commercial issues arising in many partnerships/LLPs.