Opinion ID: 3170072
Heading Depth: 2
Heading Rank: 1

Heading: Joint Venture Liability

Text: Under Louisiana law, a joint venture requires: (1) “[a] contract between two or more persons”; (2) “[a] juridical entity or person is established”; (3) “[c]ontribution by all parties of either efforts or resources”; (4) contributions “in determinate proportions”; (5) a “joint effort”; (6) “a mutual risk [of] losses”; and (7) “a sharing of profits.” Cajun Elec. Power Coop., Inc. v. McNamara, 452 So. 2d 212, 215 (La. Ct. App. 1984). Joint venturers also hold “an equal right to direct and govern the movements and conduct of each other.” Crutti v. Frank, 146 So. 2d 474, 479 (La. Ct. App. 1962). The Dragnas’ evidence does not create a genuine dispute of material fact about a joint venture between KLLM Transport and A&Z. They have not shown proportionate contributions, a joint effort, a sharing of profits, or a mutual risk of losses. A&Z used its own resources to transport the BASF load. KLLM Logistics placed all the risk of loss on A&Z in the parties’ contract. A&Z did not share in any profits made, but instead was paid in exchange for the completion of its performance. Neither division of KLLM and A&Z had “an 4 Case: 15-30216 Document: 00513343963 Page: 5 Date Filed: 01/15/2016 No. 15-30216 equal right to direct and govern” the other’s activity because A&Z alone determined how to move the BASF load. See id. Instead of creating a joint venture, KLLM Logistics subcontracted the BASF load to A&Z. A subcontractor–contractor relationship exists when an entity “enters into an agreement with a contractor, rather than the principal party whose performance is payment in exchange for . . . the completion of a project.” Texaco Expl. & Prod., Inc. v. AmClyde Engineered Prods. Co., 448 F.3d 760, 778 (5th Cir. 2006). These features are present here. A&Z contracted with KLLM Logistics, not BASF, the principal responsible for payment once the BASF load was transported.