What do you do when business partner betrays you?

“We were Best Friends. “ “ He was so nice! “ “We agreed but …” Too many instances tell the same story: business parter betrayal. You are cancelled after a dispute. Your name is removed from the bank account,  you are pushed out of the business premise outright. You are left empty handed after hard work. As one of my accountants warned me once, business joint-ventures are essentially business marriage, it hurts like hell when one partner see you as invisible. 

You have to do something.  You can sue them for breach of contract. The start point is your investment agreement. If the company is incorporation, the document is called investor agreement and bylaw. If the company is LLC, the document is called Operating agreement. If you have a partnership company, you should have a partners investment agreement. If unfortunately all you have is verbal agreement, you need to find any paperwork that reflect your agreed-upon terms. 

You can, among other avenues to hold rogue business partners responsible sue them for a breach of fiduciary duty. Fiduciary duties include the duty of loyalty and the duty of care. In member managed LLC, members take part in the day to day operations of the LLC, so they will owe a duty to each other and to the LLC to act in good faith and promote the interest of the LLC.

Word of caution. Verbal agreement is not reliable and legal battle is expensive.