Search Site
Menu

It’s Not Me, It’s You: Business Divorces in Partnerships, Closely Held Corporations, and Limited Liability Companies

There are many ways that business partnerships are like a marriage. Both create legally binding obligations on those who enter into them. And just like a marriage, a business partnership requires commitment, trust, and hard work; each person involved must do their part in order for the venture succeed. Despite the colloquialism “it’s just business” the shared experience of starting and operating a new business often results in the forging of an almost familial relationship among the members (even if the business partners where not family members to begin with, which is not at all uncommon).

It is this emotional connection that often forms between business partners that give birth to yet another similarity between a small business and a marriage: the divorce. While the legal term of art varies depending on the type of entity and the specifics of each situation, as a general rule when business partners part ways things get messy. The fight revolves around whose fault it is that things aren’t working out, who invested more in the partnership and, of course, who gets what. If you have ever been through a divorce, or been close to someone who has, these issues probably sound all too familiar.  It is these similarities that have led to the adoption of the term “business divorce” to refer to the process of legal separation between the owners of a partnership or other closely held business entity.

Like the dissolution of a marriage, it is almost always more efficient to negotiate an amicable business divorce. Unfortunately, however, business divorces seem to end up in litigation more often than not. I don’t practice family law, so I cannot make a direct comparison, but business divorces are some of the most contentious cases that I handle. I believe that this is because there is always an element of personal betrayal involved. Inevitably, one of the partners feels taken advantage of by those they once trusted. This emotional component has a tendency to amplify many of the negative aspects that are always inherent in litigation—the stress, fatigue, and worry. Accordingly, I often counsel my business divorce clients to try and “leave their feelings at the door” when evaluating whether or not to file suit.

Sometimes, however, a lawsuit is unavoidable. And in those situations, our goal is always to achieve the best result for our clients, while minimizing the interruption to their life and future business.

Adam Looney

Phone: 281-367-1222

Fax: 281-210-1361

[email protected]

Leave a Reply

Your email address will not be published. Required fields are marked *

Contact a Dedicated Texas Business Lawyer To Schedule a Consultation
Call 281-367-1222 or contact us online to schedule a meeting.

Strong In Action

  • Spring 2021

    The Strong Firm prevails in dispositive motion regarding Texas economic loss rule resulting in dismissal of claims again party.

    Read More
  • Spring 2019

    The Strong Firm successfully forecloses first priority lien against multi-million dollar commercial asset.

    Read More
  • Spring 2021

    The Strong Firm secures writ of reentry after unlawful lockout of commercial tenant.

    Read More
  • Spring 2021

    The Strong Firm prevails in writ of mandamus proceeding involving denial of temporary restraining order to stop foreclosure sale.

    Read More
  1. 1
  2. 2
  3. 3
  4. 4
  5. 5
  • Peer Rated 2021 Award
  • Clio Client-Centered Certification

Recent Blog Posts

Happy Independence Day – We Are Open For Business

Happy Independence Day! We Are Most Certainly Open For Business! Independence Day invokes feelings of individual freedom and independence being the basis on which our great country was founded.  Over the course of the last 15 months, few things have been entirely certain.  Markets, along with the availability of workers,
Read More
Happy Independence Day – We Are Open For Business

Residential Real Estate: Lawyers, Title Companies, and Agents, Oh My!

Residential Real Estate: Lawyers, Title Companies, and Agents, Oh My!   The evolution of the internet and rapid increase in access to information has changed the way we buy and sell homes. While real estate agents still serve a vital role in the process on both sides of the transaction, many buyers
Read More
Residential Real Estate: Lawyers, Title Companies, and Agents, Oh My!

COMMUNITY AND SEPARATE PROPERTY IN TEXAS: OWNERSHIP AND CONTROL

COMMUNITY AND SEPARATE PROPERTY IN TEXAS: OWNERSHIP AND CONTROL Texas law characterizes property acquired by spouses either community or separate property when property is acquired, and this characterization has tremendous consequences. w defines a spouse’s "separate property" as: (1) property owned or claimed by the spouse before marriage; (2) property acquired during
Read More
COMMUNITY AND SEPARATE PROPERTY IN TEXAS: OWNERSHIP AND CONTROL

Scams in Times of Disaster and Emergency

Scams in Times of Disaster and Emergency While Texans are generally prepared for major weather-related disasters during hurricane season from June through October, occasionally a rogue weather event, such as an artic blast, sweeps across the state causing severe and unanticipated property damage to residential and commercial properties. As individuals and
Read More
Scams in Times of Disaster and Emergency
  • Video Vault


    Watch videos done by our legal team to gain a better understanding of your legal needs. Our lawyers give video insight into areas such as Real Estate, Business Law, Mergers & Acquisitions and much more.
Contact us

Quick Contact Form