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Business litigation among family members can sometimes be avoided

It is a sad fact of American life that families that work together do not always stay together. Some of the most ruthless, prolonged and bitter controversies are conducted by family members, including by parents, children and siblings, against each other. Business litigation in Oregon and elsewhere is sometimes marked by these kinds of intractable conflicts.

Some business litigation attorneys believe that creating a framework for discussing family disagreements prior to their reaching the level of all-out war is a smart path to follow. This may be framed as a “family council” or a similar body designed to air differences in their very early stages. It is also suggested that emails and text messages are subject to misinterpretation and, thus, to the creation of increased resentment. Some observers therefore suggest that there is a substantial calming benefit obtained from person-to-person meetings.

A thorny problem that arises at times is the need to fire a family member who suffers a stress-related breakdown. Experts suggest that this potential seed of long-term conflict can be mitigated by finding another, more compatible role for the individual. However, business managers also claim that letting a family member go is sometimes vital to preserving the smooth flow, morale and continuity of the company.

Accentuation of general family values through a family constitution seems like an unlikely solution when family executives are bickering. However, experts say that it works because it reminds individuals of the values that they shared in more idealistic times when dreams and goals were first established. The idea of a family constitution can also be influential on the surviving children where the elders have passed on their founding values.

Children are impressed to know what the parents wanted. It is also important to have a dispute-resolution process established to compel members to follow the pre-set procedures. The role of the company’s legal counsel can be important, especially where counsel or the law firm has played a leadership role in encouraging and drawing up the mechanisms for peaceful coexistence. In Oregon and elsewhere, business litigation among family members is a potentially destructive dynamic to be avoided when possible. 

Source: mibiz.com, “AVOIDING ‘CIVIL WAR’ Experts weigh in on how family-owned businesses can avoid damaging litigation“, John Wiegand, Sept. 17, 2017

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