My Business Partner Is Making Decisions Without Me?

If you’re in business, chances are you’ve had to make some tough decisions. But what if you feel like your business partner is making decisions without you? It can be frustrating, especially if you feel like you’re being left out of the loop.

This article will highlight your rights as a business partner and what to do if you feel your co-owner is trying to push you out of business. Read on to learn more.

What is a business partnership?

A business partnership is a legally binding business entity formed by two or more individuals. Depending on the type of business partnership, partners co-own a business and meet all the financial and legal obligations of the business. 

Can one partner commit another to a business deal without their consent?

A partnership involves two or more individuals coming together to start and grow a business. This means each partner has a voice in the management of the business, including a share in decision-making. However, in some types of partnerships, such as limited partnerships (LPs), one partner can commit another to a business deal without their consent. Those types of partnerships have two types of partners—a general partner with unlimited authority over the business management and a limited partner whose main function is to fund the business.

For instance, a limited partner in a limited partnership (LP) can enter into a business financing deal with another entity without involving the general partner. On the other hand, a general partner can bind a limited partner to management deals if they are acting within the agreement’s terms. 

That said, you will need to take steps to prevent your co-owner from entering into an agreement without your consent. And the best time to do so is when you draft a partnership agreement with your partner.

Can you force a partner buyout or out of the business partnership?

You can force a partner out of the business if a clause in the partnership agreement provides for it. For example, if a provision allows you to terminate the partnership for any reason, this could be used as grounds. Additionally, you might be able to buy out a partner if both parties agree to it.

However, forcing a partner out of business may only be possible if the partnership deed has that provision. So, the only way you can get rid of your partner is to try to negotiate a separation. This would likely require some form of strategic investment or acquisition.

Otherwise, you will need to consult a business attorney since they know the legalities of terminating a partnership agreement.

My business partner makes decisions without me. What are my rights?

In the partnership deed, each partner has rights to information. However, if your business partner makes decisions without consulting you:

  • You have the right to include a clause in the partnership deed that prevents your partner from exercising their authority over you. That’s your first right when you come together to form a business partnership.
  • If your business partner is mistreating you because you don’t have a partnership deed, you have the right to draft one with your partner. The partnership deed will specify the rights and obligations of business partners and procedures for partnership sale, buyout, or dissolution.
  • You have the right to receive compensation if your partner is trying to or has forced you out.
  • You have the right to access business records. If your partners fail to provide either after writing a letter demanding access, you can file a claim in court.
  • If your business partner continues to treat you unfairly, you have the right to end the partnership altogether. But make sure to consult with a business attorney since they know the legalities of terminating a partnership agreement.

What are the signs your business partner is treating you like an employee?

When your business partner assigns you tasks instead of delegating them. This means they are taking control and making decisions for you rather than allowing you to take ownership and responsibility for your work. You also feel like your business partner is micromanaging you. Your business partner may also not be interested in hearing your suggestions or feedback.

What to do if your business partner is treating you like an employee?

It can be difficult to confront your business partner about this issue, but it is very important to do so to maintain a healthy and productive working relationship. Be direct and specific about your concerns, and explain why you feel you are being treated like an employee rather than a business partner. Try to devise possible solutions that would work for both of you, and be willing to compromise. If your business partner treats you unfairly, you should consider ending the business partnership altogether.

What are the legal implications of forcing a partner out?

Forcing a business partner out could have serious legal implications. They may have grounds to sue you if you do anything without their consent that could damage their reputation or finances. So be sure whatever you do is under the law and doesn’t put you and your partner at risk. Forcing a partnership, in some cases, leads to the liquidation of the business entirely, which may lead to the loss of customers, bank accounts, and licenses.

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