Contract Disputes

Contracts are vital to the ability of a business to protect its interests. Where one party fails to perform its obligations under a contract, that party may be liable for breach of contract. At Neschis & Tolitano, we litigate disputes arising out of a wide range of contracts including agreements for the purchase and sale of goods and services, real estate contracts, agreements for the purchase and sale of businesses, joint venture agreements, promissory notes, guaranty agreements, security agreements, construction contracts, distribution agreements, employment agreements, commercial real estate leases, equipment leases, confidentiality and nondisclosure agreements, and non-competition and non-solicitation agreements.

Contract litigation often involves disputes about the scope of the parties’ respective rights and obligations under the agreement. Courts presiding over breach of contract cases will try to resolve those issues by attempting to determine the intent of the parties to the contract. The language of the provisions contained in the contract such as representations, warranties, indemnification provisions, and limitation of liability clauses are critical. Subtle changes in language can have significant impacts on how contracts are interpreted. In contracts for the sale of goods, Article 2 of the Uniform Commercial Code (UCC) contains gap-filler provisions that may be applied when the parties have not covered certain areas in their agreement. Where the language of a contract is ambiguous, a court may consider evidence of discussions or agreements that are not contained in the contract in ascertaining the parties’ intent.

Contracts also often include implied terms, such as implied warranties. Every contract contains an implied covenant of good faith and fair dealing. This implied duty is implicated where the contract provides one of the parties with discretion in performing a term of the contract. The covenant of good faith and fair dealing requires that discretion be exercised reasonably and in a manner consistent with the parties expectations.

The remedies available for breach of contract vary, in part, based upon what type of contract is involved. For instance, for some types of contracts, such as real estate contracts and contracts in which unique goods are at issue, the non-breaching party may be entitled to specific performance, judgment ordering the breaching party to perform its obligations. In some cases, such as where a party was fraudulently induced to enter into a contract, the defrauded party may be entitled to rescission of the contract. If a court orders rescission, it will cancel the contract and restore the parties to their pre-contract positions.

For most contracts, the non-breaching party’s remedy is compensatory damages. To recover compensatory damages in a breach of contract action, the non-breaching party must establish an actual loss resulting from the breach. The amount of damages awarded should be designed to make the injured party whole, in the position it would have been in had the contract been performed.

At Neschis & Tolitano, we regularly bring actions on behalf of businesses where the party with which our client contracted failed to perform its obligations under a contract. We also regularly defend businesses and individuals accused of breaching a contract. Our primary objective in all litigation is to protect our clients’ legal and business interests. Whenever possible, we explore a negotiated resolution or alternative means of dispute resolution. However, we recognize that there are disputes that can only be resolved through litigation. Because we are experienced in litigating contract disputes, we are able to assert and protect our clients’ interests.