If you or your business decides to go into a business transaction with another person or entity, you might be forming a joint venture. Joint ventures offer businesses a pathway to shared resources, expanded markets, and increased profitability. However, like any partnership, joint ventures can encounter challenges, particularly when it comes to owner disputes.

One of the big issues in cooperating in a business opportunity is what kind of business is being formed. If there is no more than handshake between two companies to share the costs and profits on a project, then the law might view that as a common law general partnership. A written contract can define the relationship in innumerable other ways, from an independent contracting relationship, a lending relationship, or even the formation of a new entity. No matter what kind of business is formed, though, there are certain practical issues that can cause trouble for a joint venture.

Common Causes of Owner Disputes in Joint Ventures

Owner disputes in joint ventures can disrupt business operations and strain relationships between partners. These conflicts often arise from several common causes, including divergent goals, unequal contributions, communication breakdowns, decision-making conflicts, and issues with third parties.

When partners embark on a joint venture with different goals and expectations, it often breeds conflict. For instance, while one partner may champion swift growth and market expansion, another may prioritize profitability and operational stability. Divergence in strategic aims, financial outlooks, or operational authority can spark disagreements regarding the venture’s trajectory and resource management. These tensions may materialize as disputes over investment strategies, resource distribution, or the formulation of long-term plans.

Disputes can also erupt if one partner feels that they are contributing more to the joint venture than others or that their efforts are not being adequately recognized or rewarded. This perception of unequal contribution may arise from disparities in financial investment, workload, expertise, or risk-taking. 

Partners may become resentful or feel undervalued if they perceive that they are shouldering a disproportionate burden of investment, effort, or risk compared to their counterparts. These feelings of inequity can erode trust and collaboration within the partnership, leading to conflicts over decision-making authority, resource allocation, or profit-sharing arrangements.

The success of any joint venture hinges on effective communication, yet breakdowns in communication can swiftly escalate into disputes. Insufficient communication or a lack of transparency can breed misunderstandings, confusion, and mistrust among partners.

When partners feel sidelined from decision-making or aren’t kept abreast of crucial updates, suspicion and resentment can fester. These communication hurdles lay the groundwork for disputes to emerge, as partners may feel compelled to assert their interests or safeguard themselves against perceived risks.

Differences in decision-making power and control over key aspects of the venture can be a significant source of conflict in joint ventures. Disputes may arise when partners disagree about who has the authority to make decisions or how decisions should be made. 

For example, conflicts may arise over management appointments, strategic direction, operational policies, or financial expenditures. Some partners may feel frustrated or marginalized if they believe that their input is being disregarded or overridden by others, leading to tensions and power struggles within the partnership.

Finally, there may be individuals, entities, or regulatory authorities outside of the joint venture who have an impact on the business. If the point of the joint venture is to engage in conduct requiring a license, such as general contracting, does the local licensing authority allow for this to be done in a partnership? If the point of the joint venture is to provide services to a customer, does that customer clearly understand the nature of the business and the division of responsibilities between those involved? If the relationship offends or is not clearly understood by third parties, there can be problems for the entire business venture.

Practical Solutions for Resolving Owner Disputes

When owner disputes arise in joint ventures, finding practical solutions is essential to maintain the integrity of the partnership and preserve business operations. In this section, we’ll explore practical strategies for resolving owner disputes effectively, promoting collaboration, and protecting the interests of all parties involved.

Open Communication:

Fostering transparent and constructive communication among JV partners is the cornerstone of resolving disputes. Encouraging open dialogue allows partners to address concerns, clarify misunderstandings, and work together to find mutually beneficial solutions. 

By promoting a culture of communication, partners can build trust and strengthen their relationship, laying the foundation for resolving conflicts amicably.


Engaging in mediation facilitated by a neutral third party provides a structured and confidential forum for resolving disputes. Mediation allows partners to express their concerns, interests, and objectives in a non-adversarial setting, encouraging collaboration and creative problem-solving. 

A skilled mediator helps guide the discussion, explore common ground, and facilitate negotiations, empowering partners to reach mutually acceptable solutions and avoid prolonged litigation.


Opting for arbitration, either mandated by the JV agreement or preferred by the parties, offers a streamlined and confidential alternative to traditional litigation. In arbitration, an impartial arbitrator or panel of arbitrators hears the arguments and evidence presented by each party and renders a binding decision to resolve the dispute. 

Arbitration proceedings are typically faster and more cost-effective than litigation, providing a final resolution without the need for protracted court proceedings.

Restructuring or Buyout:

In cases where disputes cannot be resolved through negotiation or alternative dispute resolution methods, partners may consider restructuring the JV or facilitating a buyout of one partner’s interests. 

Restructuring the JV involves revising the terms of the partnership agreement, realigning ownership interests, or redefining the scope of the venture to address underlying issues and restore harmony. 

Alternatively, a buyout allows one partner to exit the venture by selling their ownership stake to the remaining partners, providing a clean break and allowing the business to move forward without ongoing conflicts.

Litigation as a Last Resort:

While litigation should be considered a last resort, pursuing judicial intervention may be necessary when all other avenues for resolution have been exhausted. In litigation, partners present their case before a court of law, and a judge or jury renders a binding decision to resolve the dispute. 

Litigation can be time-consuming, expensive, and adversarial, but it may be necessary to enforce rights and remedies under the law when other methods fail to achieve a satisfactory resolution.



Challenges are bound to arise in the ever-evolving landscape of collaborative ventures. However, through proactive measures and a firm commitment to resolving issues, partnerships have the potential to emerge even stronger.

Ultimately, resolving owner disputes in joint ventures relies on a collaborative, solution-focused approach. Encouraging transparency, trust, and a shared commitment to success enables partners to tackle challenges, overcome hurdles, and establish enduring partnerships based on resilience and mutual benefit.

By prioritizing effective communication, adhering to legal principles, and exploring innovative solutions, joint ventures can navigate disagreements and emerge as stronger, more unified entities, poised for future success.

When it comes to resolving owner disputes in joint ventures, our team at Underhill Law has your back. We understand the ins and outs of Joint ventures and are dedicated to crafting personalized strategies that protect your partnerships and interests.

With our years of experience and unwavering commitment to excellence, Underhill Law is the partner you can rely on to handle owner disputes effectively. Don’t let disagreements throw your joint venture off track—take action now to ensure your success.

Count on Underhill Law to walk you through each phase of the process, offering reassurance and a roadmap to shared prosperity. Trust us to guide you through every step of the process, providing peace of mind and a path to mutual prosperity.