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Has a partnership dispute arisen from breach of fiduciary duty?

On Behalf of | Dec 18, 2019 | Partnership Disputes |

Running a business takes a tremendous amount of work. You may have known from the beginning that taking on this endeavor alone was not the way to go, so you enlisted a business partner. This person may have been someone you had known most of your life or someone you met more recently but who had impressive business acumen from what you had seen.

At first, you and your business partner may have gotten your company off the ground and well on the way to success without any serious issues. However, you may have become more concerned about your partner’s actions recently. In fact, you may believe that he or she is no longer acting in the company’s best interests.

Fiduciary duty

As business partners, you both have a fiduciary duty to act in the best interests of the company and its shareholders. Breaching this duty can have serious negative effects on the company, and certainly, you want to ensure that those negative outcomes are mitigated. As a result, you may have first approached your business partner with your concerns. If he or she brushed you off or did not offer any explanation for actions that you believe breached his or her fiduciary duty, you may have considered other options.

Legal action

If your business partner has acted in ways that are counter to the best interests of your company and has not attempted to rectify those ways after you confronted him or her, you may need to take legal action. A breach of fiduciary duty is a serious matter, and in order to prove that such action has occurred, you may need to prove the following elements:

  • Your business partner had a duty to you, the company, shareholders or other associated parties.
  • Your business partner breached this duty, such as by misappropriating company funds, making risky business decisions without the consent of others, neglecting responsibilities or other negative actions.
  • You or the company suffered damages as a result of this breach of duty.

By taking legal action, you may be able to recover actual damages if the case proves successful. Undoubtedly, you want to do your best to protect your Florida business, so gaining information on this type of legal action may be worthwhile. After becoming more knowledgeable about your options, you may feel better able to make a decision about how to properly address the issue.