However, if the parties are desperately blocked or if there is a buyout or dissolution, the joint venture agreement should probably establish a more conventional three-person arbitration tribunal under standard procedural rules such as AAA. Of course, as in all agreements, the usual considerations, protection against a party as a repeat player with a particular arbitrator, the scope of the arbitration clause, the distribution of fees and legal fees, all of which apply to dispute settlement clauses in general, apply. In principle, a failing party would be liable for actual damage to the other party. However, this cannot prove to be a particularly effective remedy, since the other party is often a single-purpose entity, with no assets other than its shareholding in the joint venture, which may or may not have value at any given time. Other typical remedies may therefore be: an important distinction in the development of the conditions of a joint venture is the way in which members distribute the profits generated by the project. Compensation does not necessarily have to be fairly distributed. For example, more active members or members who have invested more in the project may be better compensated than passive members. The joint enterprise agreement must clearly define the capital-building obligations of the contracting parties. The capital contribution provisions are intended to clarify the responsibilities of the parties to bring capital to the joint venture. See Article IV of the limited liability company`s operating contract for Capital Contribution Provisions.
Buy, repair and sell a property together? Buying, repairing and renting a property together? Discover in a very concrete way the objective of this joint venture. In this way, both parts are clear and comfortable. A real estate joint venture is, like any other joint venture, a vehicle for co-investments of two or more, and what makes it a real estate joint venture is that the parties intend to invest in real estate or interest. They are generally structured as a limited liability company (or, occasionally, as a restricted or general partnership), and generally, the real estate joint venture increases the equity required to make a purchase or investment. However, in the case of a development or reorganization project, the same structure can be used, in which case the joint venture may include a part or part that pays capital and other parties who prefer to obtain a shareholding in the property, including for tax reasons, instead of paying for their non-monetary contribution to the business, mainly services.