Article Date: 02/22/2013


ConsensusDocs Official Comments on the Impact of the New 299 Joint Venture LLC Agreement on Communication


By Steve Rizer

 

Is there a concern that partners using the new ConsensusDocs 299 Joint Venture LLC Agreement will assume, mistakenly, that there is less of a need for communication among themselves because their roles and risks are more clearly spelled out in the agreement? In an interview with ConstructionPro Week (CPW), Carrie Ciliberto, deputy executive director and counsel for the ConsensusDocs coalition of associations, expressed no such concern and commented that, “as with all ConsensusDocs contracts, the parties [to a 299 agreement] are encouraged to have direct communications early and often…. Although having clearly defined roles and risks may lead one to believe that there is less communication, that should not be the practice.”

 

During a recent WPL Publishing webinar, Trauner Consulting Services Inc. Director Richard Burnham stressed to construction contractors, owners, and their attorneys that it is “absolutely imperative” that joint venture partners have a “high level” of communication among themselves and a “freedom of communication at the highest level within joint venture organizations” (CPW, Nov. 28, 2012, “Expert Urges WPL Webinar Attendees to Be ‘Exceedingly Careful’ When Choosing Their Joint Venture Partners”).

 

The ConsensusDocs 299 Joint Venture LLC Agreement is believed to be the first industry standard contract for joint ventures of contractors, contract managers, design builders, and design professionals using an LLC model. The agreement is expected to make it easier for multiple parties to combine efforts, pool and increase capacity, combine expertise and resources, share risks on specific projects, and further the socio-economic goals of federal set-aside programs such as the U.S. Small Business Administration’s mentor-protégé program.

 

The coalition believes that the agreement allows the flexibility needed to accommodate joint ventures between contractors, construction managers and design builders, as well as those incorporating an architect, engineer, or other design professional.

 



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