Sjoberg & Tebelius, P.A.
Serving Minnesota & Western Wisconsin

3 Mistakes to Avoid When Resolving a Dispute Between Partners

Zebras.jpgStarting a small business takes incredible effort and commitment. When an issue or dispute arises that puts your work in jeopardy, it is not unusual for a business owner to become upset and want to respond aggressively and immediately.

That said, acting without thinking or examining the legal remedies can ultimately do more harm than good.

Theft or securing company assets?

As an example, we can look at a situation involving two business owners in another state. The two women reportedly co-own a consignment boutique, but for months have been accusing each other of business misconduct and operational failures.

Recently, one of the owners decided to take matters into her own hands. After the store closed, she entered the store with about six other people. They removed licenses, machinery, inventory, furniture and even employee personal items in an effort she called "securing company assets."

The store had to close and a judge ordered the woman to return everything she took.

What went wrong

This case highlights three mistakes small business owners would be wise to avoid:

  1. Forgetting about the business - This woman's actions effectively prevented the store from opening, meaning it could not make money or welcome customers. 
  2. Making things worse - Not only are the two women still arguing over the initial disputes regarding the business, but now the other owner is pressing criminal charges against the woman who removed the contents from the store.
  3. Acting out of emotion rather than logic - In the heat of the moment, doing something like this may seem justified or satisfying; however, it does nothing to bring the matter to a logical and pragmatic conclusion.

It is crucial in these cases to not let emotion drive your decisions. Instead, parties would be wise to take a practical approach and pursue legitimate, legal avenues when attempting to resolve a business dispute.

This can include mediation or arbitration to avoid messy litigation and to allow parties to reach agreements more amicably. Doing so can preserve the interests of the business as well as any personal relationships that may be worth salvaging. 

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