Articles Posted in Contracts

For many years, lawyers and other scholars of contract law have spoken of a “meeting of the minds.” This refers to a state, sometimes called mutual assent, where there is a common understanding of an agreement’s terms between all of the parties. When there appears to be a meeting of the minds, but subsequent disputes potentially reveal otherwise, then it may require litigation to reach a resolution. Wherever you are in the process, it helps to a knowledgeable Georgia commercial contracts attorney to provide advice and representation to meet your need.

A recent case involving a dispute between a cold storage facility and one of its clients was an example of this issue of assent. The dispute arose after the grass and sod company noticed that some of its stored seed had been damaged by water and rodents, and notified the storage provider of the problem. The grass company eventually sent the storage provider an invoice for $9,625.

A week later, the storage provider sent the grass company a check, but it wasn’t for $9,625. The $275 check represented 50 cents for each pound of damaged product. The storage provider arrived at the 50-cents-per-pound rate based on a set of “Contract Terms and Conditions” that were printed on the reverse side of its warehouse receipt.

Commercial litigation can take on many twists and turns. A skilled Georgia commercial litigation attorney can help you handle your dispute, whatever events take place. For example, in one recent case, which involved a contract dispute between a gas station and its petroleum supplier, the situation became more complex when the gas station filed for bankruptcy and “rejected” the parties’ contract.

The underlying contract that spawned this litigation made a Duluth-based distributor/supplier of petroleum the exclusive provider to a gas station in Suwanee. The contract also required the gas station to buy at least 60,000 gallons of product every month. The agreement additionally called for the distributor to pay the gas station a 2-cents-per-gallon rebate on each gallon the gas station purchased from the distributor Moreover, the distributor processed credit card payments for the gas station.

At a later point, the gas station fell behind on the payments it owed to the distributor. The distributor decided to take action by withholding credit card payments owed to the gas station and netting them out against the sums that it believed the gas station owed it. Along the way, the gas station declared bankruptcy. As part of that action, the gas station “rejected” the supply contract.

One reason it is so important to secure legal counsel when entering into a business deal is to make sure that the language of a Georgia contract is as clear and unambiguous as it can be. There are several steps a court will take when interpreting the language of a contract during litigation if the language is not unambiguous and clear. In a recent Georgia appellate decision, Fannie Mae appealed from a lower court’s granting of an LLC and individual’s cross-motion for summary judgment and denial of a motion for judgment regarding its lawsuit asking for a deficiency judgment after confirmation of a foreclosure sale.

The case arose when an LLC refinanced a loan with HSBC in the principal amount of $12,500,00 and also executed a note in the company’s favor. Additionally, a guaranty was executed indicating that the key principal would have personal liability. An apartment building secured the loan, and this was described in a deed. HSBC endorsed the noted and assigned it to Fannie Mae.

Later, multiple businesses recorded materialman’s liens against the building securing the loan. The LLC admitted during discovery that it hadn’t paid or remediated the liens of several construction businesses within 30 days. It also didn’t make payments as required under the note’s terms and Fannie Mae foreclosed on the property in 2010. The court confirmed the foreclosure sale. The apartment building sold to the highest bidder for $5 million, more than its fair market value.

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Your breach of contract case may start out looking seemingly straightforward to you, but it may still eventually come to have many unexpected twists. These may involve the facts of your case, the law, the rules of procedure, or all of the above, which is one reason among many why an experienced Georgia business litigation attorney can benefit the pursuit of your case. For example, one north Georgia business lost its bid to litigate a contract breach dispute in this state when the Georgia courts concluded that the more appropriate forum for the case was California.

The case began when a north Georgia business that produced training events for other businesses fell into a dispute with the California business it had hired to perform projects for it. Eventually, the California company decided to file a lawsuit in that state. The Georgia business sued here, alleging breach of contract and fraud.

The California company asked the Georgia court to throw out the case here on the basis of something called forum non conveniens. Forum non conveniens is a Latin phrase that translates to “forum not agreeing” and essentially means that a case should not be heard in a particular forum (location) because there is a forum elsewhere better positioned to handle the case.

In a commercial litigation situation, there may be multiple different ways to achieve success. There can also be a variety of ways to damage or destroy your case. One of these is failing to complete various procedural necessities, or failing to do them on time. Procedural compliance, even though it is often completely independent of the facts of your case, can still make all of the difference between a favorable and an unfavorable outcome. To be sure your case doesn’t get tripped up by these types of problems, make sure that you retain skilled Georgia business litigation counsel.

A recent lawsuit between a contractor and a financier of commercial equipment was an example of this risk. The finance company asked for, and received, a summary judgment in its favor. The trial court’s summary judgment order effectively ended the case.

Not satisfied, the contractor sought to appeal the summary judgment in favor of the finance company. The contractor filed its notice of appeal in a timely manner. Unfortunately for it, it fell short with regard to several other procedural requirements. When you are seeking to appeal a court order that went in favor of your opponent, several things need to be done. A notice of appeal must be filed within the time period allotted by the law. Additionally, you must also make a timely request to the trial court to have a transcript created of the hearing that produced the order you are appealing. Furthermore, there may be certain court costs that you must pay and pay within a specific deadline.

In any commercial contract, there are likely several things you desire to get from the arrangement, which is why the agreement you sign hopefully has been carefully negotiated prior to execution. To make sure that you get the benefit for which you negotiated, it is important to understand what types of clauses are, and which are not, enforceable under Georgia law. To be sure your contract or any of its clauses won’t be thrown out as unenforceable, ensure you’re relying on representation from a knowledgeable Georgia commercial contracts attorney.

A recent case decided by the federal 11th Circuit Court of Appeals was one that looked at what type of fee provisions could, or could not, be enforced under Georgia law. The underlying deal was one between a chain of “quick service” Mexican restaurants and a supplier of tortillas. The deal called for the tortilla company to supply the restaurant’s tortilla needs. The deal had a provision in it for the imposition of something called a “resolution fee.” In this agreement, the obligation to pay a resolution fee was triggered only if the restaurant didn’t order at least $2.5 million worth of products from the supplier over the span of contract term.

So, if the restaurant cleared $2.5 million, the resolution fee was $0. If it fell short of $2.5 million, the resolution was equal to 5% of the difference between $2.5 million and the value of the products that the restaurant actually ordered and accepted. The deal called for the restaurant to pay the fee within 30 days, if one was owed.