Mediation Blogs

Why Mediation May Be the Best Way to Resolve Your Partnership Dispute

Being in a business partnership has many similarities to being in a marriage. Working together with another party to build a business can be a lot more productive and pleasant than going it alone. At the same time, differing goals, contributions, and values can collide when two or more parties have to work together towards a common purpose. And perhaps nowhere is the analogy between a partnership and a marriage more apt than when potentially irreconcilable differences arise; just like in a marriage, two business partners often cannot simply walk away from each other and move on, and instead have legal rights and obligations that must be worked out.

And just as divorcing spouses find that pursuing mediation is often far more fruitful and less damaging than litigating their issues, business partners facing partnership disputes – whether they lead to the end of the partnership or not – can also find far better outcomes through pursuing mediation to resolve their differences.  

You Don’t Necessarily Need a Judge to Explain Your Partnership Rights and Obligations

When a partnership dispute arises, there are basically two general methods for resolving the dispute: 1) have a neutral third party (in the form of a judge or an arbitrator) decide the outcome based on the law and facts, or 2) have the parties involved figure out a resolution to the situation, which could be done through mediation and/or negotiation.

The fact of the matter is that the vast majority of partnership disputes do not present novel and complex questions of law such that it is necessary to bring in a judge to untangle the legal issues. When parties and their attorneys can be forthcoming and clear-headed about the law and the facts, working together to create a solution that is fair on the law and the facts is attainable.

Of course, tensions and self-serving actions can complicate this process, but the job of a good mediator is to cut through those issues to help both parties reach a mutually beneficial outcome.

Litigation is Expensive and Lengthy

It should come as no surprise that some of the key benefits of pursuing mediation over litigation is that mediation gives partners the ability to move past partnership disputes without the high costs of trial prep and going to trial and the long process of partnership litigation, which can continue for months and even years.

With mediation, the parties are in control of the timeline and have the ability to end the dispute at any point, so long as they are willing to work with the mediator and the other party.

Mediation Lets You Craft Your Own Resolution

Again, a foundational question in any partnership dispute is whether you are going to seek to have a third party such as a judge impose an outcome on your disputes issues, or whether you and the other partner can craft outcomes (with the assistance of a mediator and your attorney) to resolve those differences.

Many business partners became entrepreneurs for the very reason that they did not want to work for others and instead wanted to become the authors of their own stories. For this reason, business partners often find more satisfying resolutions to disputes when they themselves are the architects of the outcomes for their business.

And while the idea of working with a business partner in a heated dispute may seem unpleasant and even impossible, an experienced mediator and partnership dispute attorney can help even the most estranged partners in crafting customized solutions to their issues.

Work With an Experienced Los Angeles Partnership Dispute Attorney

At Wagenseller Law Firm in downtown Los Angeles, our attorneys have extensive experience in resolving all types of partnership litigation matters, including those related to fraud and alleged breaches of the duty of loyalty and duty of care. Contact Wagenseller Law Firm today to schedule a consultation to discuss your partnership dispute.

Does Mediation Signal Weakness?

“I don’t care how much it costs.  I want you to sue them and I want you to be aggressive.  I don’t want you talking to the opposing attorney.  I want to serve them with papers.”

Parties in family litigation and partnership litigation usually come to me with one overriding instruction–fight regardless of cost.  Like the ancient Spartans, the instruction is usually to come back with your shield (i.e., victorious) or on it (i.e., you died trying).  In highly emotional litigation between family members or business partners, new clients are often almost universally opposed to mediation.

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