Partnership Disputes Rising: The Role of a Receiver or Fiduciary
Many of DWC’s assignments relate to distressed assets and entities that have been mismanaged or have become insolvent due to market factors. Yet a rising number stems from another common scenario: partnership disputes.
Partnerships can fail for any number of reasons, such as misaligned goals or lack of an exit strategy for one or more partners. Increasingly today, however, these disputes are distinctly related to a single phenomenon: generational differences related to family business operations.
“America is aging,” says DWC Chairman and CEO Douglas Wilson. “Those in the older generation who have wealth and are trying to pass it down are often seeing conflicts arise relative to the desires of their heirs.”
The Great Wealth Transfer
The number of Americans who are 65 and older is expected to rise from 58 million in 2022 to 83 million by 2050, according to the Population Reference Bureau. That shift among baby boomers is driving an unprecedented Great Wealth Transfer, estimated to be at least $36 trillion, with some projections placing the value at a much higher level.
Within that transfer, inherited businesses are making a mark. Bank of America’s 2026 Study of Wealthy Americans showed business ownership patterns shifting, with purchased ownership declining from 22% in 2024 to 11% in 2026, while inherited business ownership ticked up from 11% to 23% in that same time frame.
The study also noted that since 2024, family member involvement in businesses has increased. This includes roles spanning leadership and decision-making, such as management and board representation.
“The increasing participation of new family members in legacy family-owned businesses naturally brews some level of conflict,” Wilson says. “Sometimes these partnerships need a third-party voice of reason, and that’s where a receiver or another fiduciary can step in to aid in resolving the dispute and preserving value of the assets.”
The role of the fiduciary in a partnership dispute
A receiver or another fiduciary may be appointed by a court if the dispute has raised legal issues, or it may be hired privately to take control of an entity’s assets, manage the assets while the dispute is being resolved, or develop a plan for the operating company or its portfolio moving forward.
DWC has recently served as receiver, provisional director and partition referee in several partnership dispute scenarios, spanning agriculture, cannabis operations and real estate.
Referee. In one recent assignment, DWC served as referee for a family-run farming operation including facilities in Mexico and California. Due to infighting within the family, including aging owners, and increasingly challenged agricultural market conditions, such as input costs rising disproportionately with pricing, the decades-long partnership was stressed.
Provisional director. In another recent assignment, two partners owned a number of properties, including a large suburban retail center. As the partnership dissolved, DWC aided the owners in assessing the highest and best use of the property to determine if retail or housing would be the best use. As provisional director in the case, DWC provided the tiebreaking vote and worked to orchestrate the sale of the project in order to net a return to both partners.
Partition referee. In a third partnership dispute, DWC served as partition referee in the partnership’s sale of a multifamily project in a slowing rental market with short-term debt maturing. As partition referee, DWC was placed to oversee the orderly sale of the property.
“As a fiduciary, DWC is placed as a neutral third party to monitor assets and operations while partners and families work to resolve their differences,” Wilson says. “In many cases, these disputes can be time consuming and personally challenging, taking owners and operators away from the underlying business needs. As a fiduciary with nearly four decades of experience in problem resolution relating to operating companies and real estate assets, we provide expertise and support that allows partnerships to dissolve while maintaining the value of their assets.”
Facing a partnership or family business dispute? Read Receivership Series Part 3: When Partnerships Go Bad, learn more about DWC’s receivership and fiduciary services, or call (619) 641-1141.
