As with marriage, no one enters into a business relationship expecting it to end badly. But, like a prenuptial agreement, a contract that outlines the expectations of the business relationship is crucial – and that contract must also delineate how disputes should be resolved. Most business transactions involve contracts.
So, what happens if your business transaction ultimately goes bad and ends up in litigation? Well, in the best-case scenario, the clear terms of the contract are on your side. But, that will only be the case if the contract was carefully drafted with your rights and expectations in mind. And, hopefully, you didn’t sign away any legal rights, like the right to go to court if the terms and conditions of the contract need to be enforced.
Litigation expectations
No one wants to end up in litigation over a business transaction, but you should know what to expect if you are facing a legal situation that is headed that way. First, a complaint is filed with a court of competent jurisdiction, which outlines what, exactly, the problem is, how the plaintiff has been harmed by the defendant and what the plaintiff wants the court to do about it. There is oftentimes a plea for monetary damages or, in some cases, the plaintiff asks for an “injunction” – asking the court to immediately stop the defendant from doing something in particular.
From there, the case will develop through the discovery process and, usually, through back-and-forth negotiations between the parties about the status of the case, the claims involved and the amount of damages. Mediation may be at play, or there could be motions for summary judgment – which entails written motions and briefs that ask the court to decide one way or the other as a matter of law. In the end, many cases are resolved through settlement agreements. However, some cases do end up going all the way to trial. When that happens, preparation is crucial.
