How a Wholesale Business Hired a Lawyer to Draft a Joint Venture Agreement in New York

The voting rights should be based on what the parties determine to be appropriate based on your particular teaming arrangement. You also should consider if there is any voting requirement based on an end-user for the joint venture (e.g., governmental authority may require a majority ownership by one of the joint venturers as well as majority voting rights as in the case of an 8(a) certified entity).

Typically, liability for each party to a joint venture is determined by the joint venture agreement itself. However, if the joint venture agreement is not sufficient to establish liability or there is no agreement, the law imputes "per capita" (per head) liability. For example, in a joint venture that involves three separate individuals and/or entities, each venturer bears one-third of the total liability. For this reason, joint venturers commonly register a separate entity such as a limited liability company ("LLC"). Hope this helps!