Parties to a contract, and those involved in a contract dispute, have important legal rights and remedies to consider when facing contract issues.
Two Louisiana businesses, a gourmet food company and cookbook company, recently brought a lawsuit against a Louisiana distribution company the pair signed a distribution contract with. According to the food company and cookbook company, the distribution company paid a $10,000 consulting fee and a total of $75,000, to be made in payments, after signing a contract for the rights to distribute the food and cook book companies' products for five years. According to the food and cookbook companies, if the distribution company cancelled the contract early, the distribution company was to pay a $10,000 fee and return any unused inventory within five days
According to the food and cookbook companies, last August, the distribution company missed the first $2,500.34 payment and failed to make the same agreed upon payment the following month. The food and cookbook companies then sent a letter to the distribution companies requesting payment. The distribution company allegedly made partial payments on the outstanding balance and then made a series of payments in the amount of $5,737.50 on checks that were returned. The food and cookbook companies allege that the total amount of unpaid payments owed is $11,389.50. The food and cookbook companies are suing for breach of contract and are seeking a variety of damages and return of certain materials from the distribution company.
Every contract usually begins with the best of intentions, however, sometimes business relationships do not work out as planned. A party to the contract, such as a business, may suffer serious financial hardship and harm as a result of a breach of contract by another party to the contract. Because litigation concerning business contracts can be a significant undertaking for any business, both sides of a contract dispute may wish to carefully consider legal options available to the parties.
Contract relationships can involve not only contract disputes but also careful negotiation, and sometimes litigation, skills. An experienced contract lawyer can provide careful advice and guidance to either those entering a contractual relationship or experiencing a contract dispute related to an existing contract.
Source: The Louisiana Record, "Cajun food companies sue company for allegedly breaching distribution contract," Kyle Barnett, Jan. 24, 2014