Most of the time, a business divorce is precisely what it sounds like: a court case where two or more company partners dissolve their partnership. Although on the surface, it appears to be “just business,” company divorces can result in just as much emotional turmoil as divorces between couples. To help people navigate circumstances that could require a business divorce, it is essential to understand when, how, and why the partners need to separate their interests.
Traditionally, a business divorce entails the court ordering the dissolution of the corporate entity used by the parties. However, it is only sometimes feasible to end the corporate partnership by court order. Sometimes, a frustrated business partner needs to employ additional strategies in addition to the legal system to bring about the separation. When applied correctly, these techniques can build leverage. The best business litigation court lawyer can help you in this matter.
The structure of the corporation and the parties’ written agreements will determine if a real corporate divorce is feasible and, if not, what other methods may be used to compel a practical end to the relationship. As a result, the attorney guiding the person seeking a business divorce must be aware of the judicial and non-judicial rights available under the relevant statutory scheme and any applicable bylaws, certificate of incorporation, stockholder agreement, voting agreement, operating agreement, or partnership agreement. Even though they don’t appear to be “business divorces,” some situations beg for this solution. You need to hire a best business litigation court lawyer for more guidance.
Things to consider before going forward with a business divorce
You must consider certain things before going ahead with a business divorce. Some important considerations are listed below:
1) Business divorces are emotionally charged and can involve perceptions of betrayal by close relatives or friends. In a commercial divorce, even intelligent businesspeople may be motivated by emotion. Until the first bill comes, such emotion may make the customer lose focus on the economics of the problem. Even yet, some customers who are going through a business divorce continue to act in ways that many would deem to be economically illogical, allocating time, energy, and money to a plan that, even in the best-case scenario, would not yield a return that would justify the investment. To ensure that the client’s spending plans and the exercise’s purpose are connected, it is crucial to discuss them at the outset.
2) You need a goal and a budget before choosing a strategy because those two things affect the plan. If you want to be in charge of the business but need more money to spend, are you okay with having a business relationship? You could band together with other investors or members to elect new management as an alternative to going to court. Do you wish to entirely dissociate from the business and don’t care who purchases it if it is sold? A dissolving process can be necessary. But since the court will probably appoint a separate receiver or custodian to oversee the process, you might not want to request judicial dissolution if you want to have a say in who the buyer is.
If you consider divorcing your business partner, hire an experienced business divorce attorney.
CTA: If you have considered opting for a business divorce, it can seem not very clear and be a heart-wrenching experience for you. However, hiring the right lawyer can help you with this. Please contact us at Nizam Hashmi Professional Corporation; we will help you in every legal step.
