§9.4 - Joint Ventures and other Co-Ownership Relationships

• Jurisdiction: Washington

§9.4 JOINT VENTURES AND OTHER CO-OWNERSHIP RELATIONSHIPS

Strictly speaking, a joint venture is not the same as a partnership. NCCUSL, Unif. P'ship Act §202 cmt. (1997). On the other hand, even if a relationship may be labeled a "joint venture," such an arrangement may be treated as a general partnership if the basic requirements regarding the formation of a partnership set forth in Chapter 25.05 RCW are met. As discussed in §9.3(1), above, the requirement that the parties have a subjective intent to form a partnership has been removed. RCW 25.05.055(1). Thus, whether a joint venture or other co-ownership relationship results in the formation of a "partnership" under Washington law will generally be determined by an analysis under RCW 25.05.055.

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For parties to be considered a joint venture in Washington, they must meet the common-law test for joint ventures Carboneau v. Peterson 1 Wn.2d 347, 374, 95 P.2d 1043 (1939); Gleason v. Metro Mortg. Co., 15 Wn. App. 481, 551 P.2d 147, review denied, 87 Wn.2d 1011 (1976). First, there must be an agreement to enter into an undertaking having the other elements (i.e., a contract that binds the parties who enter into it and, when made, obligates them to perform it), and failure of any of them to perform constitutes, in law, a breach of contract. Carboneau, 1 Wn.2d at 374. Second, the purpose of the enterprise, whether it be for business, pleasure, or for some other objective, must be common to both, or all, parties, and not separate. Id. Third, there must be a community...