Question
I have been participating in a small joint venture for about two years now. About a year ago I formed my own LLC. I figured the remaining JV would be separate from the LLC so I haven't transferred any funds. Am I correct to assume that the profits from the previous joint venture are independent from the LLC? Should I re-negotiate the terms of the JV to co-exist with the LLC?
Answers: 1 public & 1 private
What is the relationship between the purpose and tasks of the JV and that of your new LLC? Functional guidance on your question will depend on the jurisdiction in which you, the JV, and the LLC are located and/or operate, and many other facts best left for a private consultation.
JV's are, basically, partnerships for finite projects; they are not ongoing. Now, there should be a memorandum of understanding or other operating-type agreement among the parties to the JV that controls this type of decision making; but in the absence of such an instrument you are defaulting to common law partnership tenets. If you are contemplating having to renegotiate the terms of the JV to co-exist with your LLC (i.e., there is an inherent conflict between your new LLC and that of the JV), seeking the advice of local counsel is especially recommended.
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