Can You Sue a Business Partner in Colorado? A Guide to Business Partnership Disputes

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If you’re running a business, you might have one or more business partners. While partnerships can be incredibly successful, they can also lead to disagreements. If you’re facing a partnership dispute, it’s essential to understand the relevant laws and how to best deal with your stubborn business partner.

In this blog post, we’ll discuss the law surrounding Colorado business disputes and what you can do if things go wrong.

What leads to business partnership disputes in Colorado?

A business partnership dispute may arise when partners can’t agree on important issues, such as how the business should be run, how profits are used or shared, or what should happen if a partner wants out of the partnership. These disputes can often be resolved through negotiation and mediation, but partners may have to resort to litigation if that doesn’t work.

Even if you think you do not want to pursue litigation, it may be important for you to contact an attorney to get help in resolving a pre-litigation negotiation on terms that work for you.

What are the laws governing business partnerships in Colorado?

The Colorado Uniform Partnership Law governs Colorado business partnerships. This law sets forth the rights and responsibilities of partners and how disputes should be resolved. While a partnership agreement (a contract between the partners concerning the partnership) will likely also be relevant to a dispute, the Colorado Uniform Partnership Law can void provisions of a partnership agreement in some situations.

Under Colorado law, you may be in a partnership subject to the Colorado Uniform Partnership Act even if you don’t think of yourself as in a partnership. Certain types of joint ventures or even an oral agreement to share profits and loss may subject your dispute to the Colorado Uniform Partnership Law.

Conversely, if your business is organized as a corporation or as a limited liability company (an “LLC”), different laws—such as the Colorado Corporations and Associations Act or the Colorado Limited Liability Company Act—may apply if you need to sue a business partner.

If you’re facing a business partnership dispute in Colorado, it’s important to understand your rights and obligations under the Colorado Uniform Partnership Law and how it relates to any partnership agreement you may have.

How can you best deal with a stubborn business partner?

If you’re facing a dispute with a stubborn business partner, it’s important to take action early on. Even if you think you can negotiate and mediate the dispute yourself, consider seeking legal help to inform those negotiations and protect your interests.

You don’t have to go through this alone. The attorneys at Keating Wagner can help you resolve your business partnership dispute as quickly and efficiently as possible while protecting your rights.

What are the consequences of a business partnership dispute in Colorado?

If a business partnership dispute is not resolved, it can lead to the dissolution of the partnership. In some cases, partners may also be liable for damages related to the dispute.

For example, if one partner sues another for breach of contract or breach of fiduciary duty, the court may award damages to the injured party.

Sometimes, the injured party is formally the partnership itself rather than any individual partner. In certain circumstances, a partner may be able to bring claims in the name of the partnership against another partner. Such claims are known as derivative claims. The attorneys at Keating Wagner can help you distinguish between direct and derivative claims in a partnership dispute.

How can you avoid a partnership dispute?

A clear partnership agreement can help avoid disputes in the first place. A partnership agreement can outline the roles and responsibilities of each partner and how disputes will be resolved. However, even well-written partnership agreements may not be able to anticipate disagreements down the road.

If you find yourself in a dispute with your business partner, there are a few options available. The attorneys at Keating Wagner can help you negotiate a resolution or help you in mediation. If those methods don’t work, you may consider litigation or arbitration.

In Colorado, you may be able to sue a business partner for breach of contract, fraud, breach of fiduciary duty (which can include breach of the duty of loyalty or the duty of care), and other torts. However, it’s crucial to weigh the pros and cons—with the benefit of objective, informed advice—before deciding what to do.

Contact us for more information or to discuss your case

At Keating Wagner Polidori Free, we have experience with business partnership disputes and will work to come up with a strategy that makes sense for you. We understand that these disputes can be costly and disruptive to your business and we’re here to help you get through them. If you need to sue a business partner, you need an experienced lawyer.

If you have any questions about this article or would like more information on resolving a dispute with your business partner, we are here to help. Our team has a strong reputation for advocating on behalf of business partners. Protect your company and address the conflict with our team behind you.

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