{"id":62719,"date":"2025-05-31T13:59:59","date_gmt":"2025-05-31T13:59:59","guid":{"rendered":"https:\/\/emprendix.com\/?p=62719"},"modified":"2025-05-31T14:03:38","modified_gmt":"2025-05-31T14:03:38","slug":"what-to-do-if-you-fall-out-with-a-50-50-business-partner-in-a-limited-liability-company","status":"publish","type":"post","link":"https:\/\/emprendix.com\/en\/what-to-do-if-you-fall-out-with-a-50-50-business-partner-in-a-limited-liability-company\/","title":{"rendered":"What to do If you fall out with a 50\/50 business partner in a Limited Liability Company?"},"content":{"rendered":"

Sharing ownership of a Limited Liability Company (SL) equally may seem like a good idea at first when setting up an SL<\/a>: shared decisions, equal effort, and a common vision. However, when serious disagreements arise between partners, the lack of a majority can lead to a corporate deadlock that paralyzes the company. From our business consultancy in Palma de Mallorca<\/strong><\/a>, we have supported many entrepreneurs in these kinds of situations and know how hard it can be to stay objective when conflicts become personal.<\/p>\n

What options are available to resolve the conflict?<\/h2>\n

1. Direct negotiation: talk before breaking<\/h3>\n

The first route should always be dialogue. Reviewing the company\u2019s bylaws and any signed shareholders’ agreement<\/strong> together can reveal pre-established solutions. Often, a good coffee and a structured conversation are more effective than any legal procedure.<\/p>\n

2. Mediation or arbitration: impartial solutions<\/h3>\n

If reaching an agreement on your own is not possible, business mediation<\/strong> can be extremely helpful. An impartial mediator can guide both parties toward a consensual solution without needing to go to court. Arbitration, on the other hand, resolves the conflict through a binding award. Both options are faster, less costly, and less stressful than court proceedings.<\/p>\n

3. One partner exits<\/h3>\n

When disagreement is irreconcilable, one partner buying out the other’s shares or selling to a third party may be considered. Mechanisms like the Andorran clause<\/em> or the Texas shoot-out<\/em> can facilitate this exit if previously agreed. Otherwise, an objective share valuation and clear sale terms can be negotiated.<\/p>\n

4. Legal action: last resort<\/h3>\n

If all previous routes fail, court action remains an option. A judge may intervene in cases of contested decisions or even order the company\u2019s dissolution if the conflict is structural. However, this option involves high costs, long delays, and a major deterioration of the business relationship.<\/p>\n

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When is it advisable to hire a mediator?<\/h2>\n

In our experience as a consultancy, we recommend seeking guidance from a lawyer in Palma<\/a> specialized in corporate disputes. We strongly recommend mediation<\/strong> in cases of 50\/50 partner disputes. The reasons are many:<\/p>\n