It can be exceedingly difficult to start and operate a business venture without some assistance. Setting up a business partnership allows you to take advantage of the skills, knowledge and even capital of others. For that reason, it is not hard to see why business partnerships are so common in the U.S.
According to the Tax Foundation, there are currently about 2.2 million business partnerships in the country. Not all the partnerships, though, function optimally. While partnership disputes tend to be common, you may wonder whether your business partners can outright lie to you or try to cheat you.
Some business partners have fiduciary obligations to their other business partners. Whether you owe a fiduciary duty to those with whom you work, though, probably depends on the law, the nature of your partnership and your role in the venture.
Still, if your partner is not being truthful or even actively trying to undercut you, it may be worthwhile to explore whether he or she owes a fiduciary duty to you. If so, you may have a cause of action against any partner who breaches this duty.
Fiduciary duties often include requirements to be loyal, deal fairly and otherwise exercise care to protect other partners. If your state’s laws establish a fiduciary relationship between you are your partners, however, you may have an opportunity to limit your responsibilities or to better define them. You typically can do either or both in a comprehensive partnership agreement.
Ultimately, if you think one of your business partners is trying to cheat you, it is advisable to read through your partnership agreement to understand your legal remedies and other options.