September 16, 2014 Articles

The Risks of Lurking Fiduciary Duties in Business Transactions

In joint ventures, crafting provisions addressing fiduciary duties in all agreements is imperative.

By William R. Taylor and Joshua L. Fuchs

Many companies that pool resources, share expertise, or apportion the risks and costs associated with new business endeavors enter into a wide variety of formal and informal business relationships in which they agree that they do not intend to create a partnership or joint venture. But can companies effectively disclaim the existence of a joint venture or partnership, and the fiduciary obligations that these relationships entail, or will courts disregard these contractual disclaimers and look to the parties’ course of conduct when determining whether a partnership or joint venture exists?

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