How would I dissolve a partnership that's not "legally" a partnership?
Go back to your partnership agreement to follow the procedures for buying out an owner. If your agreement is silent on that point (documents downloaded from the internet often carry the risk of omitting significant provisions), you'll have to work out your own arrangement with your partner. Maybe he'll be willing to walk away from the business for a sum equal to the return of his investment. Maybe you'll have to pony up a little more in order to get yourself free and clear.
In any event, you will need to have the difficult conversation of "this isnt working and I no longer want to do this with you." Whatever you agree to, put it in writing . . . and involve an attorney in the process to make sure it's done properly.
Nina L. Kaufman, Esq. is an award-winning New York City attorney, edutainer and author. Under her Ask The Business Lawyer brand, she reaches thousands of entrepreneurs and small business owners with her legal services, professional speaking, information products, and LexAppeal weekly ezine. She also writes the Making It Legal blog.