Dental Partnership Disputes

Dental business law

With a focus on the dental industry, our firm has spent decades addressing the legal needs of dentists.

Mediation-focused solutions

We act as facilitators, guiding disputing partners through constructive and open discussions. Our team creates a safe environment where you can express your concerns, expectations, and goals clearly.

Ensuring a strong foundation for the future

We formalize your agreements into legally sound and comprehensive documents.

Dedication to your success

Our ultimate goal is to help your dental partnership move forward harmoniously.

With skilled mediators, tailored legal solutions, and a team of industry-leading attorneys, Woods & Delgado is here to help you build a productive and legally protected future.

Mediation and Dispute Resolution

At Wood & Delgado, we prioritize mediation as our initial strategy in addressing dental partnership disputes. We believe many conflicts within partnerships can resolve through amicable negotiation, thereby preserving the business relationship and the integrity of the dental practice.

Our experienced dental business attorneys act as facilitators who guide the disputing partners through constructive discussions.

During mediation sessions, we focus on creating an environment where open communication is encouraged.

Our attorneys assist partners in articulating their concerns, expectations, and objectives. This process often involves unpacking issues that may have contributed to the dispute, such as disagreements over management styles, financial decisions, or the future direction of the practice. 

We often find that a resolution emerges when we help each other clearly express our viewpoint and understand the other's perspective. In cases where mediation leads to an agreement, our role extends to formalizing the new terms of the partnership, including drafting or amending partnership agreements to reflect any changes agreed upon during mediation.

Our attention to detail ensures that these documents are not only legally sound but also clear and comprehensive, thus preventing future misunderstandings. This process often includes redefining roles and responsibilities, adjusting profit-sharing arrangements, and setting new operational protocols.

Our goal is to provide a framework that allows the partnership to move forward harmoniously and productively, with legal protections in place to prevent similar disputes in the future.

Equitable Division in Unsalvageable Partnerships

Despite the best efforts through mediation, some dental partnerships reach a point where dissolution is the only viable option. In such instances, our focus shifts to ensuring a fair and equitable dissolution of the partnership.

The initial step in this process is reviewing the existing partnership agreement. This document usually contains information about the terms of dissolution, including how assets and liabilities should be divided.

Our legal team analyzes this agreement to understand each partner's obligations and entitlements fully. A key aspect of equitable division is assessing each partner's contribution to the practice. 

This includes financial investments and considers non-monetary contributions such as client relationships, experience, and reputation.

We strive to ensure that each partner's contribution is acknowledged and reflected in the division of assets.

Another critical component is the valuation of the practice's assets. This requires a thorough understanding of the dental industry and the particular practice's market position.

Our team works with financial experts to accurately appraise the value of tangible assets like dental equipment and real estate and intangible assets like goodwill and brand value. We negotiate diligently on behalf of our clients to ensure they receive a fair portion of the practice's worth.

When a partnership is deemed unsalvageable, our goal at Wood & Delgado is to facilitate a dissolution process that is as smooth and conflict-free as possible.

We provide comprehensive legal representation to protect our client's interests and investments, working towards an equitable outcome that allows for the closure and transition each partner needs to move forward.

Preparing for Partnerships

We thoroughly review all documents related to the practice our clients are joining, including financial health assessments and understanding the operational dynamics of the practice. 

We emphasize the importance of aligning with the business's philosophy and fitting in with the office culture.

Our legal guidance allows our clients to enter partnerships congruent with their professional goals and personal values.

Structuring Partnership Agreements

Creating a strong partnership agreement is one of the most important steps in forming a dental practice partnership. Dental professionals know the importance of a comprehensive partnership agreement when navigating complex dental practice transitions.

Such agreements establish clear guidelines to prevent and resolve partner disputes, ensuring seamless operations and protecting the interests of all parties involved. With the right framework, dental practices can adapt to changes confidently while maintaining stability and long-term success.

At Wood & Delgado, we understand the unique dynamics of dental practices and tailor our partnership agreements to meet these specific needs.

Our approach begins with a detailed discussion with our clients to understand their vision, objectives, and concerns about partnership.

In drafting the agreement, we emphasize outlining clear and comprehensive terms. This includes specifying each partner's capital contributions, whether in cash, assets, or intellectual property.

We understand that clarity in financial contributions sets a strong foundation for the partnership and helps avoid future disputes over economic matters.

Another aspect of the agreement is the distribution of profits. 

Dental practices often have complex revenue streams, and our agreements dictate profit-sharing among partners. This might involve fixed percentages, productivity-based distributions, or other creative solutions tailored to the practice's operational model.

Our partnership agreements also include detailed decision-making processes. This is particularly important in a dental practice, where decisions can range from clinical matters to business strategy.

We outline the processes for making every day operational decisions and larger strategic decisions that can impact the practice's future.

Finally, we include comprehensive provisions for dissolution. This covers retirement, disability, death, or a partner wanting to leave the practice.

These provisions outline the practice valuation process, buy-out procedures, and how to handle the departing partner's patient base and responsibilities.

Handling Partnership Changes

Change is inevitable in any business, and dental practices are no exception. When a partner wishes to leave the practice, join a competitor, or make other significant changes, you need legal strategies to protect the interests of the practice and the remaining partners.

One common strategy is to implement non-compete clauses. These clauses protect the practice from a departing partner immediately becoming a direct competitor.

We explore alternative legal strategies in states where non-compete clauses are not enforceable or are limited. 

This can include non-solicitation agreements, which prevent a departing partner from poaching clients or staff, or confidentiality agreements that protect the practice's proprietary information.

We also address the practical aspects of a partner's departure, such as how to handle equity in practice, transition of their patient base, and redistribution of responsibilities. We ensure smooth transitions while maintaining the practice's stability and reputation.

Resolving Deadlocks in Partnerships

Deadlocks in decision-making can be particularly challenging in equal partnerships.

At Wood & Delgado, we understand the need for effective mechanisms to resolve these deadlocks without resorting to litigation, which can be costly and damaging to the practice's reputation.

Our partnership agreements often include innovative deadlock resolution mechanisms. For example, a shotgun clause allows one partner to offer to buy out the other at a specified price, and the other partner must either accept this offer or buy out the offering partner at the same price.

This mechanism can incentivize partners to find common ground rather than triggering the clause. Another solution is using auctions or sealed bid processes, where partners submit bids to purchase each other's interest, and the highest bidder wins. 

This method can be particularly effective in resolving deadlocks fairly and quickly.

We also recommend the inclusion of third-party tie-breakers in some cases. This can be an external advisor, such as a mediator or an industry expert, who can provide an impartial decision or guidance to resolve the deadlock.

In all these scenarios, our priority is to maintain the dental practice's functionality and integrity and protect all partners' interests. Incorporating these mechanisms into your partnership agreements helps resolve deadlocks efficiently and equitably, preserving the partnership and the practice's long-term success.

Frequently Asked Questions: Dental Partnership Disputes