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Most partnership disputes in Florida start the same way: one partner stops honoring the deal. They skip a capital call, divert a client, or walk away mid-project. Your options come from your partnership agreement and Florida’s partnership statute.
When a partner breaks the deal, Florida law lets you sue for damages, ask a court to stop the harm, seek the partner’s expulsion, recover from a partner who leaves wrongfully, or dissolve the partnership.
Does Florida Law Treat Your Business as a Partnership?
Probably, if two or more of you run a business for profit as co-owners. Florida law treats that as a partnership whether or not you intended one, so a handshake deal carries the full partnership statute.
If your business is an LLC, a different chapter governs member disputes in an LLC, and expulsion works differently, as our guide on how to remove a business partner or member explains. This article covers general partnerships.
What Should You Check First When a Partner Breaches?
Start with the partnership agreement. It governs relations among the partners, and the statute mostly fills its gaps. A breach of the partnership agreement is usually the cleanest claim you have.
Look for these provisions:
- A dispute resolution clause requiring mediation or arbitration first
- Buyout triggers, valuation formulas, and payment terms
- Expulsion rights and the vote needed to use them
- A fixed term or defined project, which affects whether a departure is wrongful
- Capital contribution and distribution obligations
Some protections cannot be contracted away. The agreement cannot eliminate the duty of loyalty, unreasonably restrict access to the partnership’s books and records, take away a court’s power to expel a partner in the cases the statute specifies, or override the requirement to wind up the business in certain cases. Thin or silent member, shareholder, and partner agreements are a common source of litigation.
Can You Sue Your Partner Directly in Florida?
Yes. Under Fla. Stat. s. 620.8405, you may sue the partnership or another partner “for legal or equitable relief, with or without an accounting as to partnership business,” to enforce rights under the partnership agreement or the statute.
The partnership itself can also sue a partner whose breach harmed the partnership, which matters when the loss landed on the business rather than on you.
You do not need to dissolve the partnership to sue your partner for breaking the agreement. Recoverable losses follow ordinary contract principles, covered in our post on what breach of contract damages you can recover. When the numbers are tangled, an equitable accounting can sort out who owes what.
When Does a Partner’s Conduct Breach a Fiduciary Duty?
A Florida partner owes only two fiduciary duties: loyalty and care. Under Fla. Stat. s. 620.8404, loyalty is limited to three obligations:
- Account for and hold as trustee any profit or benefit from partnership business or property, including a partnership opportunity the partner took
- Refrain from dealing with the partnership on behalf of a party with an interest adverse to it
- Refrain from competing with the partnership before dissolution
The duty of care is limited to refraining from grossly negligent or reckless conduct, intentional misconduct, or a knowing violation of law. A bad business call is not enough, and a partner does not breach a duty merely because the conduct also furthers that partner’s own interest.
For the evidence these claims require, see how to prove a business partner breached their fiduciary duty and our breach of fiduciary duty practice.
Can You See the Partnership’s Books?
Yes. Florida partners and their attorneys may inspect and copy the partnership’s books and records during ordinary business hours, and former partners keep access to records from their time as partners. Records often reveal the signs a co-owner is mismanaging your company, and stonewalling creates another claim.
Can a Court Stop a Partner From Causing More Harm?
Yes, if you meet the temporary injunction standard. When a partner is draining accounts, waiting for trial may leave nothing to recover. Our guide on how to obtain an emergency injunction walks through what you must show. Preserve records now, because evidence preservation duties can attach before anyone files suit.
Can You Force a Partner Out?
Yes, through a court. On application by the partnership or another partner, a court may expel a partner who:
- Engaged in wrongful conduct that adversely and materially affected the partnership business
- Willfully or persistently committed a material breach of the partnership agreement or of a duty owed to the partnership or the other partners
- Engaged in conduct that makes it not reasonably practicable to carry on the business in partnership with that partner
Unless your agreement provides its own expulsion rights, a unanimous vote of the other partners can expel only on narrow grounds, such as when continuing with the partner would be unlawful. Misconduct is not one of them. Locking a partner out without authority can turn you into the defendant.
One trap: in a partnership for a definite term or particular undertaking, a court-ordered expulsion before the term ends counts as a wrongful dissociation under Fla. Stat. s. 620.8602, with the consequences covered next.
What If Your Partner Walks Away From the Deal?
A partner has the power to leave at any time, “rightfully or wrongfully.” Leaving is wrongful only if it breaches an express provision of the partnership agreement or, in a term or undertaking partnership, the partner leaves early by withdrawing (with a 90-day exception after certain other departures), court expulsion, bankruptcy, or, for an entity partner, willful dissolution.
A partner who wrongfully dissociates “is liable to the partnership and to the other partners for damages caused by the dissociation.” Under Fla. Stat. s. 620.8701, those damages are offset against the departing partner’s buyout price.
A partner who wrongfully leaves a term or undertaking partnership generally waits for payment until the term expires or the project is complete, unless the court is satisfied earlier payment will not cause undue hardship to the business. Any deferred payment must be adequately secured and bear interest.
How Is a Departing Partner’s Buyout Price Set?
If a partner leaves and the business does not wind up, the partnership must buy out that partner’s interest by default. The price is what the partner would receive if the assets were sold at the greater of liquidation value or going-concern value without the departing partner, plus interest from the date of dissociation.
If no agreement is reached within 120 days after a written demand for payment, the partnership must pay in cash its estimate of the buyout price and accrued interest, less offsets. These are defaults, so a well-drafted buyout agreement can replace them.
When Can You Ask a Court to Dissolve the Partnership?
A partner can petition for dissolution under Fla. Stat. s. 620.8801(5) when a court determines that:
- “The economic purpose of the partnership is likely to be unreasonably frustrated”
- “Another partner has engaged in conduct relating to the partnership business which makes it not reasonably practicable to carry on the business in partnership with such partner”
- “It is not otherwise reasonably practicable to carry on the partnership business in conformity with the partnership agreement”
In a partnership at will, notice of a partner’s express will to withdraw also triggers dissolution and winding up. For good cause, a circuit court may supervise the winding up. Our dissolution of corporations, LLCs, and partnerships practice handles both sides of these cases.
How Long Do You Have to Bring a Claim?
For most claims, the partnership statute leaves deadlines to other law, and an accounting at dissolution does not revive a barred claim. A suit over a buyout price has its own short clock: 120 days after the partnership tenders payment or an offer, or 1 year after a written demand if nothing is tendered.
The clock depends on how the claim is labeled: written contract, oral agreement, or fiduciary duty. Our post on the statute of limitations for breach of fiduciary duty explains how accrual works.
What Should You Do Right Now?
Move in this order:
- Pull the partnership agreement and every amendment
- Preserve emails, texts, bank records, and accounting files
- Make a written request for the books and records
- Avoid self-help, such as changing locks or freezing accounts, without legal authority
- Document the financial harm the breach has caused
- Weigh when to settle and when to litigate before positions harden
Many cases settle, as our guide on how to resolve a business dispute without going to court explains. If your partnership is still healthy, our guide on protecting your company from partnership and shareholder disputes shows what to put in place now.
How Jimerson Birr Helps Partners in Conflict
Jimerson Birr represents Florida business owners on both sides of conflicts over partner rights. Our business litigation and shareholder disputes and derivative litigation attorneys start with your agreement and build from there. Contact us to schedule a consultation.