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Dimitry K., Esq.
Dimitry K., Esq., Attorney
Category: Business Law
Satisfied Customers: 41221
Experience:  Run my own successful business/contract law practice.
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Partnership gone wrong ; one partner wants to sell to a competitor.

Customer Question

Partnership gone wrong ; one partner wants to sell to a competitor. The other partner wants to buy the business for more than offered. Can the 1st partner refuse to sell 2nd partner if he is offered more money ?
Submitted: 2 years ago.
Category: Business Law
Expert:  Dimitry K., Esq. replied 2 years ago.
Thank you for your question. Please permit me to assist you with your concerns.
That very much depends on your partnership agreement. Many have a 'right of refusal' clause which requires a partner to first make an offer to the other partner if they are seeking to sell the interest. But if no such clause exists, the partner is free to sell to whomever he or she wishes, and even at a loss (or for less money) because the other partner cannot legally compel the sale to go through him first. As such I would suggest you review the partnership agreement if any to see what it states--if there is a right of first refusal, then the partner must sell first within the partnership, and will have to go outside the partnership only if all partners first pass on the sale.
Dimitry, Esq.