Florida Business Lawyers Blog

While one always enters into a business relationship hoping and expecting the best, there are many ways that a commercial leasing arrangement can go wrong. There can be damage to the property, a failure to maintain the property or non-payment of rent. These and more can sometimes trigger a need for litigation. With commercial rent disputes comes the possible need for using the court registry. Whatever challenges your commercial lease dispute poses, make sure you’re prepared with experienced Florida commercial litigation counsel.

One recent South Florida case was just such a dispute between a commercial tenant and a landlord. The business relationship started with a tenant signing a commercial lease to operate a gym in a space in Palm Beach County. The lease dictated an amount of fixed rent the tenant owed. An additional section of the lease provided for some reduction to the tenant’s rent if the space encountered damage and the repairs to that damage impeded the operation of the tenant’s gym. Specifically, the lease stated that the rent “will be reduced proportionately to the extent to which the repair operations interfere with the business conducted on the Premises by Lessee.”

As fate would have it, damage did occur. The property encountered roof problems and, according to the tenant, water damage and debris from roof repairs harmed his business’ gym equipment.

Your sales distribution agreement is undoubtedly a very important contract to you. Whether you are the manufacturer or the distributor, these agreements can be vital to the success of your business. It stands to reason, then, that a breach of the agreement by the other side can be devastating to your business. Generally, proof of a breach will only entitle the injured party to monetary damages although, in some narrow circumstances, an injured party may be entitled to an injunction. To learn more about your array of options if you’ve been harmed by the breach of a commercial agreement, talk to an experienced South Florida commercial litigation attorney about your case.

One recent South Florida case offered a real-life example of a scenario that did not warrant an award of injunctive relief. On Jan. 1, 2017, a medical device company entered into an agreement with a distributor of medical devices. The agreement called for the latter to become an exclusive distributor of the former’s products in a specific sales territory for a period of five years. The agreement contained a clause that barred the distributor from selling products or services that the manufacturer considered to be in competition with its own.

Almost 12 months later, the two entities wound up in court. The manufacturer accused the distributor of breaching the contract. The manufacturer alleged that the distributor tried to unilaterally cancel the agreement and also solicited business on behalf of one of the manufacturer’s chief competitors.

Sometimes, when the entity with which you have contracted does not perform as it promised in your agreement, resolving that problem can be as straightforward as suing, obtaining a favorable verdict and damages award, and then receiving payment from the party that lost. At other times, though, deciding to bring a breach of contract lawsuit to resolve your commercial dispute is just the beginning. Whatever your commercial litigation case needs, make sure that you have Florida business litigation counsel who is familiar with all of the techniques and tools available to protect your interests.

The seeds of what would become a protracted commercial litigation case began with a real estate investor’s agreement to purchase several notes and mortgages for several properties. The purchaser wired more than $370,000 to the sellers, but they never transferred the notes or the mortgages. The failure led the buyer to sue for breach of contract and fraud. The crux of the buyer’s complaint was that the sellers didn’t actually own the mortgages and notes they purported to sell and had no intention of doing anything other than pocketing the payment provided by the purchaser.

The sellers did not take any action, and the buyer obtained a default judgment. The judgment called for the sellers to pay the buyer almost $430,000. The buyer eventually concluded that pursuing the seller companies directly was not going to yield actual payment, so it employed a new strategy. The buyer launched a supplemental legal action in which it attempted to “pierce the corporate veil” in order to go after the assets of the two individuals who owned the seller companies, as well as their other entities. The action also named the couple’s children.

One of the most fundamental decisions that has to be made in any commercial litigation action is where to bring the lawsuit. Obviously, there are many considerations that go into this decision. It is essential, though, to make sure that the court you select is a proper forum and has jurisdiction over the parties you seek to sue. Without jurisdiction, the court cannot act, and your case cannot proceed. When making these and other vital decisions, it pays to get advice from knowledgeable Florida commercial litigation counsel.

The underlying case that led to this recent jurisdiction argument was a contract dispute between a Central Florida substance abuse and eating disorder rehab facility and an insurance company based in Maryland. According to the rehab facility, it provided treatment to eight of the insurance company’s members, and it confirmed the members’ eligibility under each of their insurance policies.

The rehab facility didn’t get paid and sued the insurance company for breach of contract in Broward County. The insurance company sought an order dismissing the case against it, arguing that it did not have sufficient contacts with Florida to give the Florida courts jurisdiction over it.

Commercial landlords face many potential challenges with regard to their tenants. For example, what does it mean if a tenant stays on past the expiration of the lease period but continues paying rent month to month? What does it mean if that tenant eventually stops paying rent but still does not vacate the property? Each of these two scenarios is legally different and may call for different legal responses. To ensure that your interests are fully protected, make sure you have a knowledgeable South Florida landlord-tenant attorney representing your business.

Recently, a court outside Florida was presented with an interesting legal question. In the case, a commercial tenant (a medical clinic) had leased a space from a landlord. The term of the most recent written lease had expired in 2003. After that expiration, the tenant remained, paying rent month-to-month. In July of 2011, the tenant stopped paying rent. In December, the landlord sent a notice telling the tenant to pay up or get out. The tenant did not respond.

The landlord next filed an unlawful detainer action. Between the filing of the unlawful detainer action and the order of eviction, plumbing problems caused raw sewage to flow from the sinks in the space, permanently damaging the medical equipment, supplies, and patient records of the tenant. The tenant sued the landlord for negligence (among other causes of action). The case went to the Court of Appeal, which determined that the landlord was not liable to the tenant for damages.

Seeking to invalidate an agreement based upon a contract term that is allegedly unenforceable under the law can be tricky. The court may decide that the provision is, in fact, enforceable under Florida law. Alternately, the court may decide that the provision is unenforceable but that it is severable and, as a result, the larger agreement survives. Success, if you are seeking invalidation, lies in proving that the problematic provision was unenforceable and that it was integral to the larger agreement. If you find yourself challenging a commercial contract for this or any other reason, be sure you have representation from experienced South Florida commercial litigation attorneys on your side.

These issues of enforceability and severability were at the center of a recent dispute in South Florida. The agreement was a “subcontract” in which a construction management firm contracted for the subcontractor’s provision of doors in an assisted living facility. The subcontractor allegedly completed all of its obligations under the agreement. However, more than $100,000 remained due and unpaid, according to the door company.

So, the subcontractor sued the contractor and its surety in South Florida. Not wanting to go through a full civil trial, the contractor and the surety asked the judge to compel arbitration. The subcontract contained an arbitration provision that covered any “claim, dispute or other matter in question arising out of or related to this Subcontract Agreement.”

In any commercial contract, there are several things you are going to want to be sure the document has. However, in addition to having each of the “nuts” and “bolts” that are necessary to accomplish your objectives, all of the contract’s pieces need to mesh together into one cohesive, clear, and unambiguous agreement. If the document lacks clarity and unambiguity, this may lead to problems for you later, including in circumstances in which you need to litigate a dispute over the agreement, as one commercial landlord found in its recent Florida court case. To protect your interests, make sure you are working with an experienced and knowledgeable Florida landlord-tenant attorney when it comes to the preparation of your lease agreement.

The recent case was a dispute between a Miami-Dade landlord and its commercial tenant. The tenant was a seller of watches, jewelry. and other valuables. The landlord provided a master safe for storage of the tenant’s valuable items. The lease contract stated that the landlord assumed no legal responsibility for losses due to burglary, fire, or the vault doors failing to close properly. At some point, the tenant suffered a loss and sued the landlord for that loss. According to the tenant’s lawsuit, the landlord allowed an unauthorized person to access the master safe, and that unauthorized person removed $2 million worth of the tenant’s items.

The landlord took the logical step of asking the trial judge to throw out the case. The landlord’s argument was that the exculpatory clause in the lease agreement clearly covered the scenario that triggered the tenant’s loss, which meant that the landlord had no liability, and the tenant had no case. The trial judge agreed and ordered the matter dismissed.