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The Legal System and ADR Analysis

LAW/531 - BUSINESS LAW

Maria Wood

December 09, 2013

The Legal System and ADR Analysis

MEMO

TO: Maria Wood

From: Harold W. Smith

RE: Partnership dispute between Kimberly Merritt and Robert Groh in an unincorporated marine repair and supply business.

DATE: December 09, 2013

Handling business disputes properly can help reduce the cost of litigation. According to Cheeseman (2013), most state-level business disputes, are resolved without litigation. Depending of the severity of the business dispute, the matter could rise to the states Supreme Court on appeal. The parties involved in the business dispute can as well make use of Alternative Dispute Resolution to help reduce cost, save time, and stress to resolve the matter.

Scenario

Kimberly and Robert have been partners in an unincorporated marine repair and supply business doing business under the name “Marine World and Supply,” for the past 25 years. The parties did not enter into a formal partnership agreement; each, however; signed a letter of agreement in 1988, stating they would become 50-50 partners in the business entity. Recently, Robert decided he wanted to work fewer hours, and began taking Saturdays off, and is no longer working two evening shifts, when “Marine World and Supply” is open until 10 pm. To help cover Robert’s absence, both Kimberly and Robert agree to hire an extra employee. Kimberly, who did not agree to Roberts schedule reduction as well as believes she, is carrying an unfair share of the business burden, creating undue stress, and loss of business profits. Kimberly, instructs the “Marine World and Supply,” accountant to deduct in the amount equaling, Roberts reduction in schedule, from his drawing account. After Robert received his first reduced paycheck, as well as learns that Kimberly hired her 20-year-old son, Douglas, as a 20-hour week repair technician, and delivery driver at an hourly rate of $75 per...