Do You Need a Lawyer or a Mediator for Your Partnership Problem?

A 50/50 business partner deadlock is a decision failure, not automatically the end of the company. Mediation helps equal owners identify exactly what is blocked, separate business facts from accumulated grievances, and negotiate a workable path – renewed decision rules, a division of authority, a buyout, or an orderly separation. The mediator does not impose the result; the owners retain control of the outcome.

Sadly, the ugly reality is that if your partner complains but doesn’t offer solutions, he’s no longer a partner. A wise lawyer once taught me this important lesson when he was drawn into a nasty partnership dispute that I was working on. One of the partners was always complaining that the other was never bringing ideas to the table. The lawyer, after listening to the whining for 15 minutes said, “Tom, you need to learn to deal with the partner you have, not the one you wish you had.”

This Page is a searchable index of all posts pertaining to Business Partnership Mediations. This page is an excellent resource for articles about partnership mediation. Find all categories including Partnership Disputes, Family Business Mediation, and Partnership Agreement.

As Moderator to many family businesses, I have helped with succession planning, compensation planning, and resolving of key questions around the operation of the enterprise. It can be difficult for an adult offspring to talk with Dad about a raise.

As you see, a contract can be legal yet not binding. And, the most important take away is that a promise, even if written up and signed, is not binding. If an agreement is not binding, it isn’t enforceable. I assume you want your agreements between you and your partner(s) to be legal, binding, and enforceable. Let’s look at the pieces that must be included to make a valid, binding contract.

Before I give you the secret to easier and successful negotiation, let me explain a few things that don’t work. In fact, these will work against you. From years of watching people negotiate buying or selling, trying to change processes, or reaching general agreement, I have seen what works and what doesn’t when partners are negotiating with each other.

I’ve found a common problem with communication when I’m conducting mediation meetings. People always think they know what the other party is thinking. They’ll say things like, “I know Bill won’t like this, but I think…” Opening your thoughts with that sort of lead in is going to put ‘Bill’ on edge before you even make your point. Never start by negatively setting the stage. So then, how should you start a conversation about a hard subject? In this post I’ll give you the 7 steps to conduct less tense and more fruitful meetings with your business partner.

To be fair, many Operating Agreements have at least minimal language regarding a Partner’s voluntary exit from the Partnership. But, most of the time, those clauses are so vague they make the situation worse.

Partnerships are much like romantic relationships. When it’s all new and exciting, we can easily become infatuated to the point of overlooking differences. After all, don’t the differences make the partnership stronger? Sometimes. Most often differences magnify with time and become triggers to arguments. As time goes by, the differences you ignored become important. What do you do when the differences break the partnership?

Sometimes, in Partnership Mediations, people will dig into very irrational positions. And sometimes, when there is tension in a partnership, as a professional mediator, I can see an easy solution. When disputants won’t do simple things to protect their business, it makes me want to scream!