One day you’re building a business. The next, your partner stops showing up—but keeps their ownership, opinions, and sometimes distributions. If you’re the one still carrying clients, payroll, vendors, and momentum, you don’t have months to wait. You need legally sound steps that actually move the ball.

First Question: What Does Your Operating Agreement Say?

If you have a written Operating Agreement, it often controls. Look for:

• Duties & participation: management responsibilities, minimum time/role, remote vs. in-person work.
• Decision-making: manager-managed vs. member-managed; quorum and tie-breakers.
• Events of default/dissociation: non-participation, failure to perform, misconduct, or missed capital calls.
• Buy-sell mechanics: valuation method, trigger events, payment terms, and restrictive covenants.
• Deadlock provisions: buy-sell options, third-party tie-breaker, mediation/arbitration triggers.

No agreement? You’re not powerless. NY and NJ default statutes still provide tools.

NY vs. NJ: The Baseline Rules (Plain English)

New York: The LLC Law expects members and managers to act consistently with the agreement and fiduciary-like obligations in management. If the business can’t operate because of a member’s conduct or a fundamental deadlock, courts can consider dissolution under the statute and case law, or targeted equitable relief. Notice-and-cure language in your agreement—if it exists—can be powerful leverage.

New Jersey: The Revised Uniform LLC Act (e.g., N.J.S.A. 42:2C-46 to -48) recognizes “dissociation” events and authorizes judicial remedies when conduct is wrongful, oppressive, or makes it not reasonably practicable to carry on the business. NJ courts will look at practicality: can this company function fairly and lawfully with this member’s conduct?

Bottom line: Both states allow the court to step in when a member’s non-participation (or obstruction) makes normal operations unworkable—especially where the Operating Agreement is silent.

Your Practical Playbook (Use What Fits Your Situation)

1. Paper the problem—now. Send a calm, professional notice letter documenting non-participation (missed meetings, lack of deliverables, refusal to approve necessary actions). Tie each point to the Operating Agreement if you have one. Offer a cure window.
2. Stabilize decision-making. If you are manager-managed or have tie-breaker mechanics, use them. If not, call a formal member meeting with an agenda that advances essential business actions (banking authority, vendor approvals, payroll). Keep minutes.
3. Propose a business resolution before a legal one. Present a clean buyout framework: valuation method (CPA or appraisal), payment schedule, release of claims, non-disparagement, and where appropriate, reasonable restrictive covenants. You’ll look reasonable—and you create a record for the court.
4. Control the money trail. Review and, if appropriate, adjust distributions consistent with the Operating Agreement and solvency rules. Non-participation shouldn’t entitle a member to special treatment—especially if they’re obstructing operations.
5. Escalate with precision. If the company is paralyzed or harmed, consider targeted relief: (a) court orders compelling cooperation on specific actions; (b) judicial dissociation/removal under NJ’s RULLCA when warranted; (c) in NY, dissolution or alternative equitable relief where it’s “not reasonably practicable” to carry on the business.
6. Preserve evidence. Save emails, texts, board chat logs, meeting notices/minutes, deliverable schedules, and cash-flow snapshots. When judges see organized, timestamped efforts, you look like the adult in the room.

Composite Scenarios We See (And How They Resolve)

• Two-member stalemate: 50/50 owners; one stops working but blocks decisions. Result: formal notices, buyout proposal, then petition seeking court intervention to break the deadlock or wind up if necessary.
• Silent investor, loud veto: Capital partner contributes nothing operationally but vetoes key hires/contracts. Result: meeting minutes + targeted judicial relief to authorize essential business acts; negotiated step-down or buyout.
• Family-owned freeze: Emotions cloud decisions, books grow messy. Result: neutral valuation, tax-aware buyout terms, releases, and governance cleanup so the company can function after the separation.

Mistakes That Cost Owners Time and Leverage

• Letting it stay informal: “We talked about it” isn’t a record. Send real notices and keep minutes.
• Paying distributions on autopilot: Don’t reward obstruction. Follow the agreement—and reassess if needed.
• Overreaching remedies: Courts dislike nuclear options if you haven’t tried practical fixes.
• Skipping valuation reality: Agree early on how to value. Fighting over “what it’s worth” burns cash fastest.

When to Call Counsel (Sooner Than You Think)

Bring in litigation counsel when: (1) emails stop being answered; (2) critical approvals are stalled; (3) client/vendor relationships are at risk; or (4) you’re about to propose a buyout. The earlier we shape the record and strategy, the stronger your position—both for settlement and, if needed, in court.

This article provides general information for NY/NJ business owners and is not legal advice. Outcomes depend on your Operating Agreement, company history, and state law nuances.