Even the most successful businesses and partnerships eventually may reach a stage at which dissolution is the appropriate next step. Depending on the needs of the parties involved, in fact, some business owners will dissolve one entity so that they can form another. Alternately, business partners may want to explore other ventures and thus want to dissolve the entity. Whatever the reason behind wanting to dissolve a business, having an experienced attorney throughout the process may help to ensure that the process is executed properly. Pleasanton lawyer James G. Schwartz has over three decades of experience in commercial law matters, such as those dealing with the dissolution of partnerships and other business forms.Arranging the Smooth Dissolution of a Partnership
There are many types of business models, one of which is the general partnership. In a general partnership, all partners are exposed to personal liability for any causes of action that may arise from doing business, even if the erroneous behavior or decision was made by only one of the partners. While each partner has the authority to act individually on behalf of the business, this authority also means that each partner may be personally liable for any debt that is incurred against the business. This type of business model involves a high degree of exposure to risk for the partners involved. Therefore, it is easy to see why some may want to dissolve a partnership in favor of a different business model or simply pursue an alternative way of doing business.
To dissolve a partnership in California, each partner must go through the following steps:
- File a dissolution statement;
- Notify all known customers, suppliers, vendors, and creditors that the partnership is being dissolved (and that a new business entity is forming, if that is the case); and
- Publish a particular legal notice in a general circulation paper for at least 12 consecutive days.
As soon as the requisite paperwork is properly filed and published, the public at large is on notice that the partnership is being dissolved and that the partners no longer have authority to enter into contracts on the partnership’s behalf. During this process, any undiscovered creditors will have 90 days from the date of the entity’s dissolution to make any currently unknown debts known.
In dissolving a partnership, partners will want to ensure that no unknown creditors attempt to collect on an unknown debt, since all partners will be personally liable for such a debt. Having a business law attorney to guide you through a thorough dissolution process will help ensure that you do not have unknown creditors coming after your personal assets after the partnership has been dissolved.Enlist a Pleasanton Lawyer to Protect Your Business Interests
James G. Schwartz is a skilled business litigation attorney who serves the interests of clients in Pleasanton and elsewhere in the East Bay. He also represents entities in Dublin, Oakland, Fremont, and throughout Alameda County. Attorney Schwartz’s thoughtful guidance can assist you in dissolving a partnership as smoothly as possible. Call us today at 925-463-1073 or contact us online to schedule a consultation.