When You Plan the Marriage, Plan Your Divorce
For purposes here, joint venture is defined as two or more individuals working together on a common business purpose under a common banner. By that definition, it does not matter what the structure of the business is or whether it is a limited liability entity. There is great danger if the planning, creation and amending of organizational documents are inadequate. The maxim is this: “When you plan your marriage, plan your divorce”.
The two law partners had been practicing together for several years. When their disagreements became unbearable for both, they agreed (the only option left), to end the partnership. At the apex of the unrest, neither was speaking to the other. The escalating bitter disputes were wide ranging and involved:
- Ownership of clients
- Personal property “contributed” to the partnership – especially items including software, hardware and furniture purchased by the firm
- Considerable money in different firm accounts and WIP
- Firm name and intellectual property
- Firm parking rights
- Lease renewal
- Hiring employees
- Website, phones and numbers
- Personal guarantees of firm obligations
- Loans to and from the firm
And much more.
There was a partnership agreement that set the terms agreed to at the outset, the “wedding”, but there was no plan for the “divorce” many years later. To avoid litigation, mediation or arbitration, each party engaged counsel. My counterpart was a retired federal judge. Through many negotiations, an agreement to end the partnership amicably was reached and signed.
My client later wrote this to the person who referred her to me:
“Jeff was patient, thorough, communicative and a pleasure to work with. He was firm when needed and a good negotiator. He wrote the dissolution agreement and offered solid advice on innumerable issues as we wound up the firm.” He more than earned his fee – very reasonable.”