Common Causes of Dental Partnership Disputes and How to Resolve Them Legally
Forming a dental partnership can help dentists share costs, support each other’s growth, and build a successful practice together. But it’s not always easy for partners to work together smoothly. Disagreements and disputes frequently arise that can threaten the partnership and the dental practice.
The good news is that an experienced dental lawyer can resolve most partnership disputes. If you’re dealing with a dispute with your dental partner, don’t try to handle it alone. Call a skilled dental lawyer immediately for legal guidance to protect your rights and interests.
When Partners Don’t Carry Their Weight
A successful dental practice requires all partners to contribute their fair share of time, effort, and skill. The partnership will struggle if one or more dentists don’t meet their patient and staff responsibilities. A partner not pulling their weight can breed anger and frustration among the other partners who must pick up the slack.
There are many reasons a dental partner’s job performance may slip, such as:
- Disengagement due to stress, burnout, or personal problems
- Lack of necessary skills in clinical dentistry or practice management
- Poor patient communication and chairside manner
- Frequent absences or erratic work hours
- Unprofessional or illegal conduct like sexual harassment or substance abuse
When a partner’s behavior or performance becomes a liability for the practice, the partner must address the issue. The partnership agreement may specify a partner discipline or expulsion process, ensuring a clear and fair approach.
Without an agreement, the other partners may need to take legal action to remove an underperforming partner.
If you worry about a partner not fulfilling their duties, talk to a dental business law attorney about how to handle the situation legally to protect the practice’s interests.
Leadership Conflicts Can Threaten the Partnership
In any partnership, disagreements over leadership issues can arise, such as:
- Which partner(s) should take on managing partner responsibilities
- How to divide up authority over different practice areas
- Whether to bring in an outside consultant or professional manager
- What the decision-making process should be for major practice changes
Disputes over leadership and control often come down to clashing personalities and egos. One partner may have a more dominant, take-charge style, while another prefers collaboration and consensus. A partner with more experience or a larger ownership stake may expect to have the final say. These power struggles can lead to a tug-of-war over the practice, creating dysfunction and instability.
Ideally, the partners will decide on a clear leadership structure and decision-making process in their partnership agreement. However, even with an agreement, conflicts can still arise if partners feel the balance of power has become lopsided or unfair.
If a power struggle between partners reaches an impasse, involve a dental attorney to mediate and get the partnership back on track.
Non-Compete Agreements Can Create Conflict
Many dental partnership agreements include non-compete clauses. These provisions restrict a partner’s ability to open a competing practice nearby for a certain period after leaving the partnership.
Non-compete clauses protect the partnership from losing patients and revenue to a former partner. However, they can also result in conflict.
A partner who wants to withdraw from the partnership may object to a non-compete clause that limits their future employment prospects. Likewise, the remaining partners may feel the clause does not do enough to safeguard the practice when a partner leaves.
Gray areas can cause confusion about when the non-compete clause should apply, such as if a partner retires, becomes disabled, or dies.
Disputes over the interpretation and enforcement of non-compete clauses can lead to threats of litigation from both sides. In these situations, a dental lawyer can review the agreement, advise on the clause’s validity, and, if necessary, represent the partner or partnership in any legal proceedings surrounding the non-compete.
Buy-Sell Disagreements When a Partner Wants Out
A major test of any dental partnership is when one partner decides to leave. A comprehensive partnership agreement should include buy-sell provisions that govern the process of a partner exiting. These establish the terms for the remaining partners purchasing the departing partner’s share of the practice.
Typical buy-sell provisions cover:
- The partnership must determine how to calculate the value of the partnership interest
- The partnership must decide whether to pay the buyout in lump sum or installments
- Whether the partnership or individual partners will buy the interest
- What rights does the departing partner have to their patients and records
Even with clear buy-sell language in the partnership agreement, conflicts frequently arise when it comes time for a partner to leave. The partners may disagree over the valuation of the practice and the price for buying out the legal departing partner.
Disputes can arise over payment terms and whether the practice has sufficient liquidity to afford the buyout. If the partners are on bad terms, the negotiations can become contentious and drawn out.
Whether you are the partner leaving or the one staying, it’s wise to have a dental attorney advise you during the transition. A lawyer can protect your financial interests while avoiding legal pitfalls that can land you and the practice in court.
If the partners can’t come to a voluntary buyout agreement, a dental lawyer can assist with dispute resolution methods like mediation or arbitration. A lawyer can also defend your rights in litigation over the buyout as a last resort.
Call a Dental Lawyer for a Consultation About Your Legal Rights
No dental partnership is immune from disagreements and disputes. However, escalating conflicts with your partners can damage your relationships, reputation, and practice. Fortunately, a skilled dental attorney can resolve most dental partnership disputes.
If you face a dispute with your dental partners, the sooner you speak with a lawyer, the better your chances of finding a positive resolution that lets you move forward with your career. Call a dental lawyer today to discuss your legal rights and options in your dental partnership dispute.