Partnership disputes and the importance of listening

| Dec 11, 2020 | business litigation

When California business owners face a dispute with a business partner, usually the last thing they want to do is take the dispute to court. In some cases, litigation is necessary to find a fair resolution. However, it is often expensive and time-consuming and draws a business owner’s attention away from their company.

If business owners strive to keep any sort of partnership disputes out of court – as well as preserve their business partnership – then they should ensure that both they and their partners are prepared to sit down together and listen to each other.

Listening is essential to resolve a partnership dispute

Reminding business owners about the importance of genuinely listening to their partner might not seem like a significant issue to many. However, it is often surprising how far active listening can go when it comes to a partnership dispute.

Business owners should schedule a time to meet with their business partners and have an honest and open discussion about the dispute. At this meeting, business owners should:

  • Designate time for each partner to discuss their perspective;
  • Address the issues and concerns regarding the dispute; and
  • Concentrate only on the present issues before considering a solution.

This allows business partners to discuss the conflict in-depth, and negotiate in-house before taking any form of legal action. After all, it is essential to understand all the details of the dispute before creating a strategy for a solution.

It is often beneficial for business owners to address a meeting such as this in the dispute-resolution clause of their partnership agreement. That way, they ensure this is the first step they take when they face a dispute.

Note: Keep emotions out of the conversation

It can be difficult to keep emotions out of these kinds of disputes, especially since many business partners commonly have an established friendship outside of the business.

However, it is critical to set emotions aside and focus only on the business relationship and the business itself. Letting emotions cloud one’s judgment can impede one’s ability to listen and understand – which, in turn, can prevent business partners from reaching a solution.