Joint Venture Dispute Lawyers

The disputes we see most often arise from one party failing to meet its agreed contribution, whether in funding, expertise or resources, disagreements over profit distribution and accounting, deadlock between equal venture partners on strategic decisions, contested exit or termination provisions, and arguments over who owns intellectual property or customer relationships developed during the venture. The common thread is that the JV agreement either does not address the issue or the parties interpret it differently.

Start with the JV agreement. Most agreements contain default provisions that specify what constitutes a breach, any cure period the defaulting party is entitled to, and the remedies available to the other party, which may include step in rights, compulsory transfer provisions or a right to terminate. Where the breach is clear and the contractual machinery supports it, enforcement through the agreement is usually faster and cheaper than court proceedings. Where the agreement is silent or the breach is disputed, a claim for breach of contract sits alongside any remedies in the JV vehicle’s constitution.

Well drafted JV agreements contain deadlock resolution provisions: escalation to senior management, mediation, expert determination, put and call options, or Russian roulette and Texas shootout mechanisms that force one party to buy the other out. Where these provisions exist, they must be followed and the timetables they impose are often short. Where the agreement has no deadlock mechanism, the options depend on the venture structure: a corporate JV may support an unfair prejudice petition or a winding up petition on just and equitable grounds, and a contractual JV may be terminable on reasonable notice. In practice, the credible prospect of these remedies is usually what breaks the deadlock at the negotiating table.

By the mechanism the JV agreement provides, where one exists, including any pre agreed valuation methodology, discount provisions or independent expert determination. Where the agreement is silent, valuation follows the general principles applied in shareholder and partnership disputes: independent expert evidence on the venture's earnings, assets and prospects, adjusted for any minority or illiquidity discount unless the quasi partnership exception applies. We work with forensic accountants so the figure advanced on your behalf is supported by evidence rather than assertion.

That depends on the agreement’s termination provisions and the grounds. Most JV agreements allow termination on specified events of default, material breach, insolvency of a party, or change of control, subject to notice and sometimes cure periods. Some permit termination for convenience on longer notice. Where no express right applies, the general law permits termination for repudiatory breach, and an unincorporated venture with no fixed term may be dissolved by notice under the Partnership Act 1890. The consequences of termination, including the allocation of assets and liabilities, ongoing obligations and restrictive covenants, must be addressed at the same time.

The JV agreement should say, and where it does, ownership follows its terms. Where the agreement is silent or ambiguous, the default position depends on who created the IP and in what capacity: IP created by employees of one party generally belongs to that party’s employer under the Patents Act 1977 and the Copyright, Designs and Patents Act 1988, while IP created jointly raises more complex questions of co ownership. The practical consequence is that both parties may have rights but neither can exploit the IP freely without the other’s consent, which is why clear allocation in the JV agreement matters more than almost any other provision.

We quote fixed fees for every stage, agreed before any work starts, at prices around 30% cheaper than a standard law firm, from the initial review of the JV agreement and the underlying documents through to mediation or court proceedings. The review stage is particularly important in joint venture disputes because the agreement often contains machinery, including deadlock provisions, put and call options and termination triggers, that must be identified and used correctly before positions harden.