A co-ownership agreement is a legally binding document that outlines how you and your business partners will operate together. It sets the rules around ownership, responsibilities, profit sharing, and what happens if someone wants to leave. Without it, even small misunderstandings can spiral into serious legal and financial headaches.

Define Ownership, Roles, and Responsibilities Early

At the heart of any co-ownership agreement is clarity. It should answer:

• Who owns what? Clearly state how much each partner is contributing, whether it’s cash, assets, IP, or sweat equity.
• What does each partner do? Outline each person’s role in the day-to-day running of the business.
• How are profits and losses shared? Specify how you’ll divide earnings and absorb any losses.

Agreeing on these details upfront helps avoid conflict down the track, and gives everyone a shared understanding of what they’re signing up for.

Get Decision-Making Right From the Start

Equally important is how decisions get made. Does every partner get an equal say? What if one of you owns a larger stake or brings in most of the revenue? And what happens when you disagree?

“Having a process for making decisions and resolving deadlocks is essential,” says Krishnil Singh, Solicitor at Corban Revell. “If you don’t agree on how votes work or what happens if you can’t reach a consensus, the whole business can stall at a critical time.”

Well-drafted co-ownership agreements often include processes for voting, mediation or arbitration – tools that protect relationships and avoid expensive legal disputes later on.

Plan for the Unexpected

Too often, people avoid thinking about worst-case scenarios. But what if a partner wants to exit the business, is no longer able to contribute, or passes away?

“A good agreement will include buy-sell clauses or rights of first refusal so you’re not caught off guard,” Krishnil explains. “It keeps ownership within the trusted group and protects the business from outside interference.”

Understand the Risks and Get the Right Advice

It’s not just about profit. Co-owning a business means you could also be on the hook for debts, liabilities, or legal claims, depending on how your structure is set up. Understanding those risks before you begin is critical.

“Every business is different,” Krishnil adds. “There’s no one-size-fits-all agreement. Tailoring the document to suit your business model, your goals, and your partners is what makes it work in the long run.”

Thinking About Going Into Business With a Partner?

Setting up a clear co-ownership agreement is one of the smartest things you can do. It protects your investment, defines expectations, and gives your partnership the structure it needs to succeed.

Need guidance on a neighbourhood dispute?

Contact Krishnil Singh.

The post Going Into a Co-Ownership Agreement? Here’s What Every Business Owner Needs to Know appeared first on Corban Revell.

Without proper legal advice and a bit of digging, what looks like a promising business venture can turn into a costly mistake. Jump in too quickly and you could find yourself out of pocket and on your own when things don’t go to plan.

It’s frightening how quickly a franchise agreement can unravel when expectations aren’t met and legal protections aren’t in place. Unfortunately, small business owners can find themselves isolated, financially exposed, and without the backup they were promised.

When Promises Falls Short

Corban Revell lawyer Krishnil Singh has seen the fallout firsthand: “Franchise opportunities can be appealing, with an established brand, set systems, and the promise of support. But we often see small business owners run into trouble with hidden costs, restrictive clauses, or limited flexibility down the line.”

“In some cases, franchisees are encouraged to invest significant capital. This can sometimes mean tens of thousands put into vehicles, marketing, or equipment before they’ve had the chance to properly evaluate the business. Promises of national marketing campaigns or guaranteed shelf space can fall flat. And without legal safeguards, it’s the franchisee who bears the risk.”

So what should you do before signing a franchise agreement? Krishnil explains,“My advice is simple. Get independent legal advice before signing anything. Even a franchise that looks like a golden opportunity can come with strings attached if you don’t do your homework.”

Here’s an overview of what we recommend for anyone considering a franchise arrangement:

1. Talk to your lawyer before signing anything

Don’t rely on the franchisor’s word or their lawyer’s documents. Your lawyer should be working solely in your interest and will be able to highlight potential risks and red flags in the agreement.

2. Understand what you’re really paying for

Some franchisees are asked to pay high upfront fees, contribute to marketing, or finance specific equipment. It’s important to understand exactly where your money is going and whether the value stacks up.

3. Read the fine print on support and training

What kind of support are you actually getting? How often is training provided? If these aren’t clearly spelled out in the contract, there’s no guarantee you’ll get what’s been promised.

4. Watch out for termination and exclusivity clauses

We’ve seen agreements where franchisees can be removed from the business with little notice, sometimes under vague conditions like ‘bringing the brand into disrepute’. Check whether you have real protection if things go wrong.

5. Do your due diligence on the people involved

Research the background of the franchisor. Have they been involved in previous failed ventures? Do they have a history of forming and dissolving companies? This information can be incredibly telling and it’s usually public.

6. Talk to other franchisees (past and present)

If a franchisor discourages contact between franchisees, consider it a red flag. Talking to others who’ve been through the process can reveal a lot about what you’re signing up for.

Franchising can be a legitimate and successful path into business ownership. But it’s not risk-free, especially when the power imbalance between franchisor and franchisee isn’t checked by good legal advice.

Taking the time to understand what you’re signing and having someone in your corner can make all the difference.

Need advice?

If you’ve got questions or you’re not quite sure what to look out for in a franchise agreement, or any other kind of business contract, feel free to get in touch with Krishnil Singh.

The post Before You Sign: How to Spot Franchise Red Flags appeared first on Corban Revell.