Summerville Partnership Dissolution Lawyer
Under the South Carolina Code of Laws Section 33-41-910, the dissolution of a partnership is the “change in the relation of the partners caused by any partner ceasing to be associated in the carrying on as distinguished from the winding up of the business,” referring to the dissolution of the business. Dissolving a partnership is a big decision, and one that should not be taken lightly, as dissolution of a partnership can be a breach of contract and result in a lawsuit. For various reasons, business owners may wish to part ways and end their relations, which is in their right under the appropriate circumstances. However, it is also important to remember that, while partners share the profits and gains equally when dissolving the partnership, so too do they share the losses including debts. Among other issues, it is vital to properly document all debts, assets, and other property of the business during the dissolution of a partnership Furthermore, even after a dissolution of partnership agreement is signed, the legality of the partnership continues on until:
- Debts have been settled;
- The legal existence of the business is terminated; and
- Assets have been distributed.
When a Partnership Can be Dissolved
Unless a partnership specifies otherwise, it will automatically dissolve when one partner dies, withdraws, or suffers an illness or some other complication that keeps them from being able to perform their duties as a partner. Other reasons for dissolving a partnership include the following:
- Bankruptcy;
- Profit loss;
- Merger;
- A partner gets expelled;
- A partner retires;
- A partner buys out the other partner(s) and the partnership becomes a sole proprietorship;
- Turning into a corporation, or another change in registration status;
- Unlawful practices;
- Conditions in the partnership agreement have been fulfilled; and
- More.
Partnership dissolution is not uncommon. 70 percent of partnerships end up failing, according to The Balance, often due to lack of business success, unequal partnership duties and commitment, and differing values and vision.
Why Having a Lawyer For Dissolution of a Partnership is Necessary
Dissolving a partnership can be complicated, and there are legal ramifications for making errors. As such, following is a short list of reasons why retaining legal counsel is necessary:
- One partner wants to continue running the business and the other(s) do not. The court may order that partner to buy out the others;
- Buying out other partners is not financially possible, forcing a partner to liquidate the business;
- Partners cannot agree on the distribution of assets and liability;
- The value of the business is not agreed upon, or the partners are unsure of the value of their business;
- The process of compiling debt, taxes, and other liabilities;
- Breach of business contract;
- One of the partners files a lawsuit against the other; and
- More.
A Summerville Partnership Dissolution Lawyer Can Help
Whether one partner passes away or retires, or you cannot agree on the terms of dissolution, talking to a partnership dissolution lawyer may be in your best interest. To speak with an experienced Summerville partnership dissolution lawyer today at Shelbourne Law, call 843-871-2210.
