No Partnership When
Written Agreement Said No Partnership
In a summary order issued by
the United States Court of Appeals for the Second Circuit, it affirmed the
determination that a particular business relationship was not a partnership
because the purported partners, in writing, stated that it was an independent
contractor relationship. Galvastar Holdings,
LLC v. Harvard Seel Sales, LLC, No. 17-1571 (2nd Cir. Jan. 16,
2018).
In this case, one of the two
parties to a business relationship asserted that it was a joint venture with,
consequently, fiduciary obligations between the two parties. The trial court
rejected this assertion, that conclusion was affirmed by the Second Circuit.
After reciting the elements of a joint venture, the court pointed to the terms
of a pair of agreements that provided:
The relationship of Galvstar and
Harvard under this agreement shall be solely that of independent contractors.
Nothing contained herein or any other documents comprising a part hereof shall
be deemed to constitute or create a relationship of agency, joint venture,
partnership or any relationship other than that as herein specified.
In that the two participants
were not partners/joint ventures, no fiduciary duties arose.
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