What Fiduciary Duties Do I Owe My Business Partner?
Business partners need to work together to make their business a success. But some business partners aren’t so helpful. For all your own hard work, you may recognize that your business partner isn’t putting in the same effort. In some cases, they may even be actively harming your business.
When you’re in business with someone, you owe them certain fiduciary duties. That means your partner should have been a trusted part of the business who should act in the business’ best interests. If they failed to do so, you may need a business litigation lawyer to step in. At Albright, Stoddard, Warnick & Albright, we’re here to help your business succeed, even if your partner isn’t taking the same steps.
Duty of Good Faith and Fair Dealing
When operating a business, you’re expected to uphold your duty of good faith and fair dealing. This duty means you and your partner must act honestly and fairly when it comes to business dealings. Typically, that means doing everything in your power to help make the business a success.
It also covers not interfering with or sabotaging the party’s performance. For example, if your business partner fails to do their part in maintaining the business, they may be liable for any damages that result.
Duty of Loyalty
Like one’s duty of good faith, the duty of loyalty is in place to prevent business partners from acting in a way that would harm the business. But the duty of loyalty also refers specifically to acting in one’s best interests. To uphold this duty, partners need to reveal if there’s a conflict of interest.
For example, let’s say you’re running a business that sells cars. But you discover later that your business partner has stocks in another car company. It may be in their best interests to hurt your car company so that they reap the benefits of working with another company.
What Happens if My Business Partner Doesn’t Commit to These Duties?
When your business partner acts in bad faith, breaches your business contract, or fails to uphold their fiduciary duties, you may be entitled to compensation. Their actions may have led to your business suffering, which can impact your livelihood, your reputation, and your family.
If you believe your business partner failed in their duties and your business was impacted by it, speak with a lawyer. Your lawyer can help you gather evidence against them and seek compensation for your business losses.
Speak with a Business Lawyer about Your Next Steps
When your business partners fail to maintain these duties, your business may suffer for it. That’s a problem if you’re trying to keep your business afloat.
If your business partner is failing to uphold the agreement between you, you may need a lawyer at Albright, Stoddard, Warnick & Albright to help you take action. Your business lawyer can discuss your claim through a free consultation when you call 702-384-7111 or fill out the online contact form below.