Common Causes For Commercial Litigation

Commercial disputes are unfortunately common. No industry is immune, and they can happen at any stage of a business’s lifecycle—even when a business has been successful and trusted by customers for many, many years. Legal action can quickly become necessary when disagreements involving breaches of contract, disputes between partners, or issues with customers or vendors arise.

Below, our friends from Volpe Law LLC explore several of the more common causes for business-related legal disputes and how having legal counsel by your side can help businesses protect their interests.

Breach Of Contract

One of the more common causes of companies getting involved in litigation comes from breach of contract claims. In most business relationships, contracts are at their foundation. They govern everything from employment arrangements, intellectual property use, delivery and payment terms, to name just a few.

Partner And Shareholder Disputes

Disagreements between business partners and shareholders are unfortunately common. Especially between partners or shareholders of a small company, these disagreements can feel highly personal. Allegations of misconduct, different management styles and decisions, and profit distribution are common causes of disputes between partners and shareholders.

If documents that govern operating agreements or bylaws are unclear or not current, it can be extremely difficult to resolve these internal conflicts without the help of commercial litigation lawyers. While enlisting the help of legal counsel does not guarantee a resolution, they can assist in interpreting agreements, enforcing rights, or seeking judicial intervention when needed.

Employment Disputes

Another common cause for commercial litigation is when legal issues arise between employers and employees. Commercial litigation claims often involve allegations of workplace discrimination or harassment, non-compete agreements, wage and hour disputes, and wrongful termination.

It only takes one employment claim to significantly hurt a company’s finances and reputation. It is important to have clearly written, sound contracts and policies in place to help avoid these and to respond quickly and appropriately when disputes arise.

Torts And Fraud

Tort-based commercial claims involve civil wrongdoings that are committed in an economic context and result in economic harm. These claims are distinct from contract disputes. They often involve allegations of fraud, interference with contracts, or misrepresentation. They can involve competitors, customers, vendors, or even internal personnel.

An example of a tort-based commercial claim is if a rival company intentionally caused a buyer to breach an existing contract with the other company by offering them significantly lower prices. If this tortious interference results in damage to the other company’s business, they may have a claim against the rival.

Benefits Of Early Legal Support

When legal guidance is onboard from the onset of a business start-up or is sought quickly when problems first arise, it can help to minimize or even avoid disputes. A commercial litigation lawyer can help assess risk, interpret agreements, and represent your interests when conflict becomes unavoidable.

When conflicts cannot be avoided, corporate commercial litigation lawyers can provide business owners with legal strategies that are tailored to the specific nature of their disputes. Working with experienced legal counsel can help to protect both assets and business relationships in the process.