When people form partnerships, one primary thing they create is a partnership agreement. This agreement states information about the members, the course of how business is handled and details regarding the dissolution of the partnership. Generally, if a member leaves the partnership, the business is dissolved. If you have a partnership and want to get rid of a partner, you must first consult the agreement to determine your options regarding dissolving the business.
Determine the reason for getting rid of the member. Typically, certain parts of a partnership must exist for it to work. If one of these parts is missing, it might be time to dissolve the partnership and get rid of one of the partners. These include trust, respect and sharing common goals.
Discuss the idea with the partners. Depending on how many partners the business has, you might encounter problems with this idea. If all partners feel the same way about it, however, dissolving the business might be the best answer. After an agreement is made with the partners, discuss the issue with the partner you want to get rid of.
Negotiate. After the decision is made, begin negotiating with the partners to determine how to go about dissolving the business. The partnership agreement should contain information such as how assets and liabilities must be divided and the appropriate steps to take to dissolve the company.
Seek help from an attorney. If negotiating is not going well, ask an attorney to help resolve this matter. In this case, the partners must attend a court hearing generally, and the judge will decide how to divide business assets and liabilities.
Create a partnership dissolution agreement. This can be done on your own or through an attorney. This document states that the partnership is being dissolved and explains how it will take place. It includes many other details as well including distributions, arbitration information and waiver of contractual rights. This document is usually sent to all third-parties involved with the partnership to inform them of this action.