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Can this partnership dispute be avoided?

On Behalf of | Dec 22, 2017 | Construction Law

There is no doubt that construction is a hands-on business. If you are a contractor, you are used to striding around a job site wearing a hard hat and a pair of steel-toed boots. Climbing a ladder to inspect a third-story roof is second nature to you. Your idea of hell is sitting behind a desk in some office.

But a common problem for some contractors is the inherent personality differences they have with their business partners. Make no mistake — partnering with someone who has a different but equally as important skill set than you is the basis of many a successful partnership. Disputes arise when expectations, strategies and managerial philosophies diverge too far from what each partner believes is best.

Here’s how it can happen: Howard and Byron are partners in a small residential construction company. Howard typically secures financing and balances the books without fail. Byron has the contractor’s license and is ready to don a tool belt when necessary to help the crew finish a construction phase.

Howard tends to micromanage the crew, making work more stressful for them than it has to be. Byron, who has spent his whole working life among construction workers, doesn’t sweat the small stuff and lets minor issues slide as long as the job gets done. These disparate attitudes toward personnel management can start out as tolerable quirks but build to crescendos of resentment and frustration.

Another dragon to slay for some business partners is struggling to integrate both partners’ vision about the company’s future. For instance, if Byron wants to branch out and start bidding jobs on large industrial complexes but Howard sees more growth potential in building subdivisions, one or both will wind up very unhappy.

How can I avoid a partnership dispute?

Not every dispute is avoidable, but many can be anticipated. With a path to resolution clearly defined in the operating agreement, both parties understand their options and what is at stake. You can retain an attorney to draw up an operating agreement that includes the contingencies that might need to be addressed.

Source: Forbes, “How To Avoid A Partnership Dispute,” Shane Robinson, accessed Dec. 22, 2017