Whenever we start a business, we are optimistic and see only good things ahead. However, most business partnerships eventually fall apart. That is why going in, you need to have a plan for what happens next. A mediator can help address these problems at the outset by assisting in the drafting of the corporate or business partnership documents. Here are some helpful reasons why you want a prenup for your business.
1. Business Value Protection
When a business relationship ends, it is likely that some of the parties will want to carry on. This is why it is best for all concerned to have a mechanism set up to allow the business to continue.
2. Resolving an Impasse for a Business Partnership
If your business partnership involves 2 people, or any other even number, you need to account for the possibility that you have a dispute that can’t be resolved. Even without a 50/50 split, it may be advisable to protect the rights of members in the minority against being ganged up by the majority.
3. Litigation Costs
Having to resolve a post-business partnership dispute in litigation is expensive, time consuming and distracting. Consider setting up a mechanism for mediation or arbitration to resolve any future disputes more efficiently.
4. Clearly Understood Terms
Business partners think they understand their agreement going in, but the documents need to clearly state the parties’ understanding. An ambiguity in the documents could lead to litigation or even the end of the business partnership.
In Summation
A mediator experienced in business litigation can help the parties understand and plan the business relationship at the outset, instead of waiting for a problem down the road.
To better assist you, we offer online scheduling to help you minimize risks to your business.
Sam Ventola has a wide variety of experience in litigation, legal education, and mediation. When not saving the world from unresolved disputes, he enjoys volunteering in the community and spending time with his family, especially his grandson, Jack.
Ventola Mediation serves the Denver Metro area including Arvada, Aurora, Boulder, Brighton, Commerce City, Castle Rock, Golden, Lakewood, Littleton and Arapahoe, Adams, Douglas and Jefferson Counties in Colorado.
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