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  1. #1

    Default What Happens if Business Partners Disagree

    My question involves business law in the state of: Florida

    Let's use a hypothetical example of a Partnership with 4 equal General Partners, each owning 25%. This business owns 10 rental houses.

    Partner #1 wants to liquidate and dissolve the business.

    Partner #2 wants to acquire more property.

    Partner #3 wants to sell all the real estate and use the money to start a restaurant under the same partnership.

    Partner #4 has no opinion either way.

    Or what about more minor disagreements like how much distributions to give out, or which property management companies to use.

  2. #2
    Join Date
    Oct 2006
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    15,745

    Default Re: What if Business Partners Disagree

    A properly set up partnership agreement would govern all of those things. That is how things should happen. In the end however, its going to be mainly majority rule, even with a properly set up partnership agreement.

  3. #3
    Join Date
    Oct 2014
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    Default Re: What if Business Partners Disagree

    Unless at least 3 of the general partners agree on what to do then nothing will get done unless there are provisions in the partnership agreement that provide a way to resolve disputes when the partners are deadlocked. So, like your questions on the family limited partnership (and I'm guessing this question is really a way to try to ask about the FLP) a lot depends on the terms of the partnership agreement.

  4. #4

    Default Re: What Happens if Business Partners Disagree

    Quote Quoting Taxing Matters
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    Unless at least 3 of the general partners agree on what to do then nothing will get done unless there are provisions in the partnership agreement that provide a way to resolve disputes when the partners are deadlocked. So, like your questions on the family limited partnership (and I'm guessing this question is really a way to try to ask about the FLP) a lot depends on the terms of the partnership agreement.
    Yes, well I learned that the FLP will become a partnership upon death of both General Partners.

    The 4 limited partners of the FLP become 4 General Partners of a new General Partnership upon death of both General Partners of the FLP.

  5. #5
    Join Date
    Jun 2006
    Location
    Massachusetts
    Posts
    24,132

    Default Re: What Happens if Business Partners Disagree

    One would hope that the partners would pretend to be grownups and work out their differences between them. Since there isn't any law that says, "When partners disagree about X they have to do Y".

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