Partnership Disputes: Joint Ventures
A joint venture is a business entity created by two or more parties. A joint venture can be thought of as a temporary partnership. Businesses join together to share costs and risks while in pursuit of a common goal. Companies and entrepreneurs may enter a joint venture for a wide range of different reasons—from a commercial real estate project to a technology venture.
In some cases, joint ventures are designed to accomplish a single project. In other cases, joint ventures may be focused on an ongoing objective within a particular industry. As with other business ventures, disagreements between the parties can sometimes arise. Here, our Miami partnership dispute attorneys explain what to know about disputes and joint ventures in Florida.
Why Disputes Arise in Joint Ventures
Businesses enter joint ventures because they see an area of common interest and opportunity. At the same time, parties to a joint venture are not quite the same as business partners. The temporary nature of these relationships can increase the risk of disputes. Some of the most common reasons why disputes arise within joint ventures include:
- Disagreements regarding corporate governance;
- Alleged failure of cooperation;
- Failure to commit sufficient resources to the project;
- Allegations of unfair practices or deceptions;
- Breach of fiduciary duty or breach of duty of loyalty;
- Alleged misuse of proprietary information; and
- Questions about profit-sharing;
You Need a Strong, Well Crafted Joint Venture Agreement (JVA)
A joint venture agreement (JVA) is a contract between two or more businesses that have agreed to work together on a project. In Florida, your JVA is the primary source of your rights and responsibilities. If a dispute arises, the court will refer back to the specific terms of the joint venture agreement. A well-drafted agreement will both reduce the risk of conflict and protect your rights should any problems arise. Among other things, a joint venture agreement should address:
- The financial contributions of each party;
- The rights and duties of each party;
- The ownership interests;
- The scope and duration of the agreement; and
- Dispute resolution.
Mediation and Arbitration is are Often a Good Option to Resolve a Dispute
Commercial litigation can be costly and time-consuming. For this reason, many business disputes are well-suited for alternative dispute resolution (ARD), such as mediation or arbitration. Partnership disputes and joint venture disputes are especially good candidates for ADR, as the parties may still want to try to preserve their commercial relationship. If you are involved in a dispute regarding a joint venture, do not hesitate to consult with a South Florida partnership lawyer about mediation and arbitration.
Call Our Miami, FL Partnership Dispute Lawyers Today
At Pike & Lustig, LLP, our Florida partnership dispute lawyers are driven to help our clients find reliable, cost effective solutions. If you are locked in a joint venture dispute, we can help. With offices in Miami and West Palm Beach, our law firm handles partnership disputes, joint venture disputes, and commercial litigation throughout all of South Florida, including in Broward County, Miami-Dade County, Martin County, and Palm Beach County.