Florida LLC Member Dispute Attorney

An LLC member dispute is not one lawsuit with one set of rules. It is a fight that lives inside a contract (the operating agreement), a statute (Chapter 605 of the Florida Statutes), and a set of fiduciary duties, and which of those controls usually decides who wins. The Andrew M. Schwartz Legal Team handles business and real estate litigation for LLC members, managers, and minority owners, and as a Florida LLC member dispute attorney team we represent clients in Palm Beach County, Broward County, and across South Florida.

Most member disputes begin with something that looks small: a distribution that did not arrive, a capital call one member ignored, a manager who stopped sharing the books. By the time owners call a lawyer, the question is usually bigger. Can the company keep operating? Can I be bought out? Can a court step in and dissolve this thing, or put someone in charge of it while we sort it out? The answers depend on what your operating agreement says and on how the other side has behaved.

Before you do anything else, find your operating agreement and read the sections on management, distributions, transfers, buyouts, and dispute resolution. Florida’s LLC statute fills gaps, but a well-drafted agreement often overrides it, and a poorly drafted one leaves you relying on the statute’s default rules.

Grounds for Judicial Dissolution of an Florida LLC

Florida law gives a member or manager the right to ask a circuit court to dissolve an LLC on specific grounds. These are not a general “we don’t get along” remedy. A petitioner has to fit within the statute, and the grounds are worth knowing by name because each one points to a different kind of evidence.

The court can dissolve when all or substantially all of the company’s activities are being conducted unlawfully, or when it is not reasonably practicable to carry on the business in line with the articles of organization and the operating agreement. It can also dissolve when those controlling the company have acted, are acting, or are reasonably expected to act illegally or fraudulently. Two grounds come up constantly in the disputes we see: company assets being misappropriated or wasted in a way that causes injury, and a management deadlock that the members cannot break while irreparable injury to the company is threatened or already happening.

A separate path exists for the state itself: the Department of Legal Affairs can seek dissolution of an LLC that obtained its articles through fraud or keeps abusing the authority the law gave it. That is not a member remedy, but it shows how the statute divides the territory.

Dissolution is also not always the end of the road. Once a dissolution case is filed and shows sufficient merit, the court has other tools, including appointing a receiver or custodian and ordering a buyout of the petitioning member’s interest. Before appointing a receiver or custodian, the court must hold a hearing after notice to all parties and to an interested person it designates. And if the operating agreement contains a deadlock sale provision that someone sets in motion before the court finds deadlock grounds exist, that contractual mechanism takes the place of a dissolution order or court-ordered buyout, so long as it is then carried through. A well-written buy-sell clause can therefore decide the outcome before a judge ever does.

Why Choose the Andrew M. Schwartz Legal Team for LLC Member Disputes

The Andrew M. Schwartz Legal Team is a South Florida business litigation firm that represents business owners, investors, and families in partnership disputes, business divorces, and conflicts between LLC members and shareholders. Andrew M. Schwartz, the firm’s founder, has spent 37 years in litigation and has practiced in Florida since his admission to The Florida Bar in 1989. He earned his undergraduate degree from Emory University in 1986 and his law degree from the University of Miami in 1989. His career has centered on complex contract disputes and the breakdown of business relationships, which is exactly what an operating agreement fight is.

He is joined by Sundeep Nath, Senior Counsel, a Northwestern-trained litigator with years of experience in business and real estate cases in state and federal courts. That matters for LLC disputes because some of them end up in federal court when the parties live in different states, and our clients frequently do: we represent members from New York, New Jersey, and Connecticut whose co-owners or properties are in South Florida, and we handle the local court appearances so they do not have to travel for every hearing.

The firm works as a true team, so everyone on a matter knows the file, and we keep a strict 24 hour return call policy. We are experienced in mediation and arbitration as well as courtroom litigation, and we look for the resolution that fits your goals and budget rather than stretching a case out. A recent result illustrates the courtroom side: after a 5-day bench trial in Broward County Circuit Court, the court issued a 32-page final judgment awarding our client specific performance of a commercial real estate contract. Many LLC disputes turn on exactly that kind of detailed reading of an agreement and the parties’ dealings under it.

Common Types of LLC Member Disputes We Handle

• Deadlocked Management: Two 50/50 members, or a board of managers split evenly, cannot approve a sale, a loan, or a budget. Statutory dissolution grounds can apply when the deadlock cannot be broken and irreparable injury is threatened, and many operating agreements contain deadlock sale provisions that must be examined first.
• Breach of the Operating Agreement: A member competes with the company, transfers an interest in violation of transfer restrictions, ignores capital call obligations, or bypasses required consent votes. These claims rise or fall on the precise wording of the agreement.
• Breach of Fiduciary Duty: A manager or controlling member self-deals, steers opportunities to a side entity, or runs the company for personal benefit at the minority’s expense.
• Missing or Diverted Company Funds: Unpaid distributions, commingled accounts, personal expenses run through the company, or a manager who cannot account for cash. Remedies can include an accounting, recovery of funds, and emergency relief to freeze assets.
• Minority Member Oppression: A majority group cuts a minority owner out of information, decision-making, and distributions while collecting salaries and perks. Dissolution grounds, a court-ordered buyout, and contract claims may all be in play.
• Buyouts and Valuation Disputes: A departing member and the company disagree about what the interest is worth, what discounts apply, or what formula in the agreement governs.
• Family and Friend-Owned LLCs: Siblings who inherited a company together, parents and children with different visions, or spouses and in-laws sharing ownership. These carry personal weight that ordinary commercial disputes do not.
• Real Estate Held Through an LLC: Investment property owned by a company whose members now disagree about selling, refinancing, or who gets what. These disputes can overlap with partition and title issues when ownership is held in other ways.

What to Do When Your Co-Member Dispute Turns Serious

Start by collecting documents, because LLC disputes are won on paper. Gather the articles of organization, the operating agreement and every amendment, tax returns, bank and credit card statements, capital contribution records, meeting minutes, and any emails or texts in which members discussed money, authority, or the future of the company. If you are a member, you generally have information rights, and a refusal to produce books and records is itself evidence worth preserving. Do not delete anything and do not remove company property or funds on your own, even if you believe the other side is doing the same. Self-help tends to hand the other party a counterclaim.

Pay attention to deadlines, because the clock depends on the type of claim. An action founded on a written instrument, such as a breach of a written operating agreement, carries a five-year limitations period. A contract claim not founded on a written instrument has four years. Fraud claims run four years from discovery, subject to an outer cap of 12 years, and a suit seeking rescission of a contract has four years. A claim for specific performance has only one year. Those windows can overlap in one dispute, so assume the shortest relevant one until a lawyer has looked at the facts.

If money is actively leaving the company, speed matters more than anything else. Courts can issue temporary injunctions and, in appropriate cases, appoint a receiver or custodian to preserve assets, but that relief requires evidence, not just suspicion. Bring bank statements, transfers, and an explanation of what is changing and why it cannot wait for a final judgment.

Where the case is filed depends on the company and the claims. Disputes over $50,000 are heard in circuit court, and a judicial dissolution petition is a circuit court matter. For Palm Beach County companies that is the Fifteenth Judicial Circuit, which sits in and for Palm Beach County, including at the main courthouse in West Palm Beach. For Broward County companies it is the Seventeenth Judicial Circuit, which sits in and for Broward County and has a complex business division that handles, among other things, dissolution of certain business entities and large business litigation. A case can be filed directly into that division only by following the procedure in the circuit’s administrative order, and the clerk randomly assigns it to a division judge. Federal cases involving diverse parties go to the Southern District of Florida, which holds court in Fort Lauderdale and West Palm Beach, among other locations.

Finally, do not assume litigation is the only path. Many LLC disputes end in a negotiated buyout, a structured wind-down, or a mediated resolution, and your operating agreement may require mediation or arbitration before anyone can sue. Reading that clause early prevents you from filing in the wrong forum.

How Corporate Dissolution Law Differs From LLC Dissolution

Owners often assume the rules for corporations and LLCs are interchangeable, and in a business with both kinds of entities that mistake can cost time. Florida’s corporate statute has its own dissolution framework. A shareholder can petition a circuit court for dissolution on grounds that include a corporation abandoning its business and failing within a reasonable time to liquidate, distribute assets, and dissolve. The corporate statute also builds in a buyout off-ramp: in a shareholder-initiated dissolution case, the corporation or other shareholders can elect to purchase the petitioner’s shares at fair value, and if the parties agree on value and terms within 60 days of the first election, the court enters an order directing the purchase on those terms. That election is irrevocable unless the court finds it equitable to set it aside or modify it.

The corporation must also notify the other shareholders, within 30 days after the proceeding begins, that they may avoid dissolution by electing to buy the petitioner out. And while a dissolution case is pending, the court can issue injunctions, appoint a receiver or custodian, and take other steps to preserve corporate assets and keep the business running until a full hearing.

The practical point is that LLC members, particularly those whose operating agreements borrow corporate-style provisions, need to confirm which statute and which contract terms govern their entity before choosing a strategy. We review those documents first.

Florida LLC Member Dispute Questions

Can I force a business partner out of an LLC in Florida?

It depends on your operating agreement and the conduct involved. Many agreements include buyout, expulsion, or dissociation provisions, and the statute offers remedies when a member has engaged in serious misconduct or the company can no longer function. We review the agreement and explain which route is realistic.

What counts as deadlock for purposes of dissolving an LLC?

Under the statute, deadlock means the managers or members are deadlocked in managing the company, cannot break the deadlock, and irreparable injury to the LLC is threatened or already occurring. Simple disagreement is not enough. Evidence of the injury is what usually decides these petitions.

My operating agreement has a buy-sell or deadlock sale clause. Does it control?

Often yes. If a deadlock sale provision is initiated before the court finds that deadlock grounds exist, the provision applies in place of a dissolution order or a court-ordered purchase of the petitioner’s interest, provided it is then carried out. Timing and procedure matter, so do not trigger or ignore the clause without advice.

Can a court appoint someone to run the LLC during the case?

In a dissolution proceeding, a court can appoint a receiver or custodian if the petition shows sufficient merit, after holding a hearing with notice to the parties and an interested person the court designates. It is a significant remedy and is not granted automatically.

What if a partner is taking money from the company?

You may have claims for breach of fiduciary duty, an accounting, conversion, and recovery of the funds. In urgent situations a court can order injunctive relief to stop assets from being moved or spent while the case is pending.

How long do I have to sue over a breach of the operating agreement?

For a claim founded on a written instrument, the limitations period is five years. Claims not founded on a written instrument have four years, fraud runs four years from discovery within a 12 year cap, and specific performance has one year. Because different claims in the same dispute can have different deadlines, an early review is worth doing.

Is it worth hiring a lawyer if my LLC dispute involves a modest amount of money?

Often it is, because the amount at issue is not the only measure of what you stand to lose. Your ownership stake, your control of the business, and your exposure to continuing obligations may all be involved. We also weigh cost against likely recovery and look for efficient resolutions such as negotiation or mediation before recommending full litigation.

I live in New York or New Jersey. Can you handle my South Florida LLC dispute?

Yes. We regularly represent clients from New York, New Jersey, and Connecticut who own businesses or real estate here. We handle the Florida court proceedings, keep you informed at each stage, and arrange scheduled conference calls so you do not have to travel for every hearing.

Does the LLC dispute have to end up in court?

No. Many are resolved by negotiation, mediation, or arbitration, and some operating agreements require those steps first. We are experienced in both alternative dispute resolution and trial work, and we pursue whichever path best fits your goals and budget.

Can a dispute over LLC-owned real estate involve a partition or title claim?

It can, depending on how title is held. If property is owned directly by co-owners rather than by the company, Florida’s partition statutes allow a court to divide the property or order it sold and the proceeds divided among the owners. We also handle quiet title actions to clear competing ownership claims, and we sort out which tool fits the way title is actually held.

Do you work with other attorneys on LLC disputes?

Yes. A significant part of our practice comes from referrals by other lawyers, including out of state counsel whose clients have Florida disputes and Florida attorneys who do not handle business litigation. We keep referring counsel informed and respect their relationship with the client.

Serving LLC Member Dispute Clients Across Palm Beach and Broward Counties

Our work begins in Palm Beach County, where we represent LLC members and business owners in West Palm Beach, Boca Raton, Delray Beach, Boynton Beach, Lake Worth, Palm Beach Gardens, Jupiter, Wellington, Royal Palm Beach, Greenacres, and Belle Glade, along with the surrounding communities. Many Palm Beach County disputes are heard in the Fifteenth Judicial Circuit, and we appear there regularly.

We also serve clients throughout Broward County, including Fort Lauderdale, Pompano Beach, Deerfield Beach, Coral Springs, Parkland, Plantation, Sunrise, Hollywood, Davie, Weston, Pembroke Pines, and Coconut Creek. Business disputes there often land in the Seventeenth Judicial Circuit, including its complex business division, and federal matters may be heard in the Southern District of Florida.

Beyond those two counties, we represent LLC members from throughout South Florida and out of state clients from New York, New Jersey, and Connecticut who hold interests in South Florida companies and properties.

Talk With a Florida LLC Member Dispute Lawyer About Your Case

If you are locked in a conflict with a co-member over money, control, or the future of your company, the earlier a Florida LLC member dispute lawyer reads your operating agreement, the more options you tend to have. Call the Andrew M. Schwartz Legal Team to schedule a consultation. We will look at the documents, explain where you stand under the agreement and Chapter 605, and give you a practical view of whether the right outcome is a negotiated separation, a buyout, or litigation.