Business partnerships and romantic relationships share one thing in common: in the beginning, everything is super and you can’t get enough of your partnership’s brilliance. But as soon as you go past the honeymoon phase, you begin to learn the other side of your partner that you don’t like. Consequently, conflicts and disagreements set in.
Just like romantic relationships, not all business partnerships can endure the heat of conflicts. And when the partnership is damaged beyond repair, it is only sensible that the partnership is dissolved so everyone can go their separate ways. But how do you know it is time to sever ties with your business partner? Here are a couple of warning signs that your business partnership could be headed for turbulent times:
1. Your partner is no longer acting responsibly
Each partner has an obligation to hold the interests and success of the partnership above personal interests. This is known as fiduciary duty. If your partner is making risky and potentially costly personal and business decisions, you need to figure out if you really want to continue working with them. Examples of irresponsible behaviors may include alcohol and substance addiction, inappropriate relationships with employees, fraud and other behaviors that may expose the business to the risk of lawsuits and financial losses.
2. Your partner is dishonest
Honesty and accountability are the chords that hold any relationship, including a business partnership, together. From misrepresentation of the truth to stealing from the business, dishonesty comes in different forms. If your partner’s dishonesty is costing the business, or is likely to expose the business to lawsuits and government penalties, you need to reconsider the partnership.
Safeguarding your interests
Not every partnership is a match made in heaven. Learning more about California business laws can help you protect your rights and interests when addressing partnership disputes.