Typical disputes between co-owners
- Deadlock over management, distributions, or the direction of the company
- Claims of breach of fiduciary duty, self-dealing, or diversion of opportunities
- Demands for books, records, and an accounting
- Disputed capital contributions, loans, and compensation
- Buy-sell provisions, valuation, and forced buyouts
- Expulsion, withdrawal, and dissolution
Start with the governing documents
The operating agreement, partnership agreement, bylaws, or shareholder agreement usually controls voting, transfer restrictions, buyout formulas, and how disputes are resolved, often by mediation and arbitration. Where the documents are silent, California's Revised Uniform Limited Liability Company Act, the Uniform Partnership Act of 1994, and the Corporations Code fill the gaps.
Options short of litigation
Many co-owner disputes end in a negotiated buyout or separation agreement. A clear agreement on valuation, payment terms, releases, non-solicitation, and transition can preserve value for everyone. When negotiation fails, the firm can pursue claims or defend owners and managers accused of breaching fiduciary duties or the governing documents, in arbitration or court, including requests for an accounting, dissolution, or appointment of a receiver where appropriate.
General information about California law, not legal advice for your situation. Deadlines and outcomes depend on the facts and the documents. Past results do not guarantee or predict a similar outcome.