Partnerships or Joint Venture – Which is Right for You

Partnerships and Joint Ventures

We often hear about joint ventures mainly in relation to mining operations or other large projects when two or more companies get together to develop a coal seam or search for oil or build a bridge or highway.

Business partnerships are also extremely common.  A great many professional practices (accountants, lawyers, architects and other) as well as many small businesses are carried on as partnerships.

So, what is the difference between the two?  Essentially, the main difference is that business partnerships involve an ongoing or repetitive process or operation between individuals, such as carrying on a business for profit.  Partnerships can continue in existence for a very long time.  Whereas, joint ventures usually involve a “consortium” of companies who, as indicated above, get together for the purpose of carrying out a single venture or project.  Governments are also involved in joint venture particularly when the exploitation of a natural resource (such as oil) is involved so that the objective of a joint venture is a product (oil) rather than a profit although that presumably follows.

Partners in a business are usually required to devote the whole of their time and effort to the partnership.  They are said to be in a fiduciary relationship to each other.

Until recently, joint venturers were not considered to be in the same fiduciary relationship to each other however, two recent court decisions suggest joint venturers do owe one another the same fiduciary duties as partners.  Traditionally, the duties joint venturers owed to one another have been thought to be far narrower and less onerous than the duties partners owe to one another.

At Lopich Lawyers we can help you whether you want to set up a business partnership to operate fish and chip shop or a medical practice.  We can also help you if you are planning to establish a joint venture to develop a residential estate or explore for gold.

Contact one of our commercial lawyers on 1300 783 634 or email