Partnerships and joint ventures are legal structures in which two or more parties combine resources and talents toward common business objectives. Joint ventures are frequently formed to complete a single project or accomplish a specific goal, whereas partnerships are often ongoing arrangements. There are also other important differences that you should understand if you’re considering launching one of these entities. As an Irvine business law attorney at TransActionLaw, I have over 30 years of experience helping clients in California evaluate what business structure is right for them and draft sound agreements to safeguard their interests.
California partnerships are formed when two parties begin doing business together for profit. In a general partnership, partners share profits, along with legal and financial liability, equally. There are also limited partnerships that can be advantageous because they offer liability protection for the limited partners (though not the general partner). After learning about your business goals, I’ll inform you about the possible advantages and disadvantages of a partnership based upon your particular situation.
While general partnerships aren’t legally required to be spelled out in writing, having a well-written agreement in place will help protect your interests. A partnership agreement should thoroughly outline all the details of the partnership including its business purpose, the responsibilities of the partners, financial information and more. It should also include a partnership resolution that describes how potential disputes will be resolved. My law firm creates and negotiates detailed, enforceable partnership agreements for California clients.
A joint venture may be right for your business when you need additional resources and skills to help you accomplish a specific project or goal. The contractual agreements between the parties outline how the joint venture is split, meaning what each party brings to it and how profits are divided. It does not have to be a 50/50 split. Parties in joint ventures operate as separate entities legally. However, some joint ventures develop into new legal entities. Should you require assistance with LLC formation or the creation of a different type of business, I can help. Advantages of forming a joint partnership include increased financial and talent resources and the ability to share risk. Some disadvantages might be unrealistic objectives, differing management styles and poor communication. I can help you decide if the benefits of a joint venture outweigh the pitfalls given your situation and goals.
Each joint venture is unique, but the agreements my firm prepares usually contain clear stipulations regarding:
These are just a few of the items typically included within joint venture agreements. As a detail-oriented transactional business attorney with decades of experience, I will rigorously consider every area of your joint venture and any identify potential areas of concern when drafting your contract.
At TransActionLaw in Irvine, I draw on more than 30 years of experience when advising California businesses about partnership and joint venture agreements as well as other legal concerns. To schedule a consultation, call my firm at 949-668-1385 or contact me online.