An Attorney For Business Matters
The right attorney can be one of your business’ most valuable assets. An experienced business lawyer can often advise you on legal matters throughout the life cycle of your business from forming your business to drafting contracts to selling the business, and most litigable matters along the way.
Breach Of Contract
Contracts are extremely important in the world of business. Every agreement your business enters into with a client or with another business is a contract. Contracts can be written or oral. They can even be implied by a pattern of recurring conduct between businesses.
Because contracts are so essential to the day-to-day operations of a business, it can create significant problems when a party to a contract stops fulfilling their obligations. This is known in legal terminology as a breach of contract.
In a business, a breach of contract could occur in any variety of ways. A few common examples of a breach are as follows:
- The other party fails to pay money they owe your business.
- The other party does not fulfill an order your business placed with them.
- The other party starts a competing business in violation of a non-compete agreement.
- The other party fails to perform or complete work that it is obligated under the contract to perform.
However the breach occurs, your business needs to be able to deal with it as quickly and efficiently as possible. An experienced business attorney can help you and the other party get back on track with the contract or can help you pursue a breach of contract claim against the other party in court. In many cases, attorney’s fees can be recovered by a successful claimant in breach of contract litigation.
Fraud comes in many forms. If another party deliberately induces your business into entering a transaction by doing any of the following things, you may have a viable claim for fraud:
- Knowingly makes a false statement about a material (i.e. important) fact
- Recklessly makes a statement about a material fact without knowing whether it was truthful or not
- Fails to disclose material information
- Deliberately conceals material information
- Makes a false promise of future performance
If another party has caused your business to perform an action or enter an agreement under false pretenses such as those listed above, and has thereby caused harm to your business, that party should be held accountable.
Because fraud is such a serious matter, and because it involves such bad conduct, Texas law allows victims who successfully prove a fraud claim to recover exemplary (sometimes called punitive) damages in addition to actual damages.
Note: When your business has been injured by someone else’s breach of an agreement, it is tempting to assume that party acted in bad faith all along. And sometimes, it is difficult to know whether a party who breaches a contract has also committed fraud. But although fraud claims often revolve around a breach of contract, not every breach of contract involves fraud. Many times, parties enter into contracts with the intention of honoring the agreement. The breach happens later when the breaching party is no longer willing or able to perform its obligations. The key difference is that fraud occurs when the breaching party never intended to perform its obligations from the start.
In Texas, it is unlawful to knowingly interfere with a business’ existing or prospective contracts. For example, if your business enters into a contract with a client, and a competitor disparages your business (i.e., says negative and untrue things) in order to convince that client to breach the contract with your business and do business with them instead, that is tortious interference with an existing contract. Similarly, if a competitor defames your business to a prospective client, that is tortious interference with a prospective contract.
The important thing to remember is that being competitive is not illegal. A business has to remain competitive to survive. But when unscrupulous businesses cross the line from healthy competition into committing unlawful acts in order to lure away your existing or prospective clients, you can pursue a claim for tortious interference.
We also handle non-litigation matters for business owners or prospective business owners, including:
- Business formation
- Dissolution of business
- Sale of business
Click here or call 281-720-6881 to contact your Baytown business attorney.