Relationships between business partners can go south; if they do, the partners will likely want to go their separate ways and move forward independently. Dividing or dissolving a business via legal proceedings, commonly known as a business divorce, is typically a complicated process. Further, in many cases, the parties can become combative, which often leads to protracted legal battles. As such, it is critical for anyone looking to sever their professional ties with their business partners to seek the assistance of an attorney. The assertive New York business litigation attorneys of The Linden Law Group, P.C. have ample experience helping parties navigate the complexities of business divorces, and if you engage our services, we will fight to pursue an outcome that protects your interests as well as your financial health. We regularly represent individuals and companies in business divorce matters in Manhattan, Queens, the Bronx, Brooklyn, and Staten Island, as well as in Nassau and Suffolk Counties.Situations that Lead to Business Divorce
Typically, a business divorce is necessary when one partner wants to leave a company or business owners decide to close a business, but issues arise that prevent an amicable dissolution. In some instances, the parties have diverging views on issues such as what obligations or rights arise out of the business's articles of incorporation or partnership agreement, how to handle the death of a business partner, and whether a partner has the right to take trade secrets or intellectual property when they leave the business. Disputes can also be caused by a partner's alleged breach of a fiduciary duty or theft of resources. These conflicts can impact any type of business entity, including limited liability companies, partnerships, and corporations, and often cause one party to pursue a business divorce.Dissolving a Company Through a Business Divorce
Regardless of what underlying disagreement caused a party to seek a business divorce via litigation, the primary issue in most business divorce cases is how the court should value and divide the business's shares and assets. In deciding this issue, the courts will first determine whether the parties entered any agreements that address how such matters should be dealt with, and if they did, what the terms of the agreement dictate.
For example, when some parties found a business, they will enter into buy-sell agreements, which are contacts that establish how to value interests in the business, when the owners can transfer such interests, and to whom they may be transferred. As such, if a buy-sell agreement binds business owners, one of the owners will most likely ask the court to enforce it with regard to the dissolution of the company or the transfer of shares or assets. If the court deems the agreement valid, it generally will rule that it is enforceable and order the parties to abide by its terms. Even if business owners do not have a buy-sell agreement, they may still be limited as to how, when, and to whom they can transfer their business shares by the company bylaws.
If business owners do not have a written agreement stating how a company may be sold, divided, or dissolved, the court must determine the value of the business and the manner in which its shares or assets should be divided. There are multiple ways a court can determine a business's value, including market-based, asset-based, and income-based approaches or a combination of one or more methods.Talk to a Skilled New York Attorney
The process of dissolving a business partnership can be as emotional and contentious as the end of a romantic partnership, and it is wise for anyone that wants to dissolve or leave a company to retain an assertive attorney. The skilled New York business litigation attorneys of The Linden Law Group, P.C. are proficient at helping parties sever their business relationships, and if you want to seek a business divorce, we can develop an effective strategy to help you pursue a fair outcome. We have offices in Manhattan and Long Island, and we frequently represent parties in business divorces in Manhattan, Queens, the Bronx, Brooklyn, and Staten Island, as well as in Nassau and Suffolk Counties. You can contact us at (212) 537-6612 or via our online form to set up a consultation.