10 Common Issues in Commercial Contract Disputes in South Florida

Commercial contract disputes can disrupt companies’ operations, threaten deadlines, and lead to other business risks and losses. As a result, when these disputes arise, an informed and strategic approach is essential. Taking an informed and strategic approach starts with understanding all of the issues at hand, and this requires the advice and insights of an experienced Miami contract dispute attorney.

Potential Issues in Commercial Contract Disputes

While commercial contract disputes can involve a wide array of issues, certain issues tend to be more common than others. Here are 10 examples of common issues that have the potential to lead to commercial litigation:

1. Failure to Perform

Perhaps the single most common issue in commercial contract disputes is failure to perform. If a party to a commercial contract fails to meet its contractual obligations, then the other party may have no choice but to take legal action. From failing to deliver promised goods or services to failing to pay post-delivery, all types of contractual breaches can lead to disputes if the parties are not able to find a mutually satisfactory resolution on their own.

2. Failure to Meet Quality Standards or Service Level Agreements (SLAs)

Along with failure to perform, failure to meet quality standards or service level agreements (SLAs) is a common issue in commercial contract disputes as well. If a commercial contract includes quality standards or SLAs, failure to comply with these requirements can potentially have the same consequences as a complete failure to perform. In some cases, however, parties may stipulate that SLAs are aspirational rather than binding—and, in this scenario, legal action may not be warranted.

3. Liability for Third-Party Claims

Commercial contract disputes can also arise out of third-party claims. Let’s consider a personal injury claim related to an ongoing construction project—which is one of many common scenarios. If the claimant files a lawsuit against the property owner, the property owner may seek indemnification from its prime contractor, alleging that the prime contractor’s negligence is to blame. If the indemnification clause in the parties’ contract is not abundantly clear, this could lead to continuous and high-stakes litigation.

4. Breaches of Representations and Warranties

Breaches of representations and warranties (or alleged breaches of representations and warranties) are common issues in commercial contract disputes as well. Here, too, the specific language in the parties’ contract plays a central role. If the relevant contract language is clear, then pursuing enforcement may be a relatively straightforward process. On the other hand, if the parties disagree about what has been represented or warranted, a dispute is much more likely.

5. Breaches of Confidentiality and Restrictive Covenants

Breaches of confidentiality obligations and restrictive covenants can cause immediate and, in some cases, irreparable harm. As a result, when these breaches occur, prompt legal action will often be required. Even when commercial contracts include mandatory alternative dispute resolution (ADR) clauses—as is often the case—they will often include exceptions that allow the parties to seek emergency injunctive relief in court if necessary.

6. Violations of Intellectual Property (IP) Rights

From software licenses to franchise agreements, and from marketing agreements to manufacturing contracts, numerous types of commercial contracts include provisions pertaining to one or both of the parties’ intellectual property (IP) rights. Violations of parties’ IP rights can have significant financial consequences, and IP owners must often take prompt legal action to protect their exclusive ownership. Disputes regarding IP ownership arising out of joint ventures and other commercial business arrangements can lead to contentious and high-stakes disputes as well.

7. Violations of Post-Termination Restrictions

While many commercial contract disputes involve issues arising during the term of the parties’ agreement, disputes can also arise after a contractual relationship ends. These include disputes related to post-termination restrictions. Violations of non-competition and non-solicitation covenants frequently lead to disputes, as do violations of restrictions on the use of IP and other assets.

8. Cybersecurity Breaches

Cybersecurity breaches can expose proprietary information, customers’ and employees’ personal information, and many other forms of sensitive data. As these breaches become increasingly common, companies are increasingly including cybersecurity provisions in all types of commercial contracts. In the event of a cybersecurity breach, being able to rely on contractual protections can be essential for mitigating the legal, financial and reputational risks involved—and, in most cases, companies will not hesitate to take legal action when necessary.

9. Fraud Allegations

Commercial contract disputes can also involve allegations of various forms of fraud. This includes fraud prior to contract execution (though the ability to pursue this type of claim may be restricted by the contract’s “Integration” clause) as well as fraud during the contractual relationship. By their nature, disputes involving fraud allegations tend to be highly contentious, and while settling may be a possibility, parties that need to pursue fraud claims will often have to take formal legal action to protect their commercial interests.  

10. Disagreements Over Dispute Resolution

As noted above, commercial contracts frequently include mandatory ADR clauses that require the parties to submit any disputes to mediation or arbitration (or potentially both). Commercial contracts will also frequently include provisions regarding governing law, jurisdiction, legal costs and fees, and other dispute-related matters.

While these types of provisions are intended to facilitate efficient resolutions without the need for litigation, ambiguities and questions of interpretation can lead to disputes involving these provisions—and the parties may need to litigate these disputes before they can address the substantive issue(s) at hand. As with all types of commercial contract disputes, experienced legal representation is critical, and an experienced Miami contract dispute attorney will be able to assist with evaluating all of the options that are on the table.

Schedule a Call with a Miami Contract Dispute Attorney at Gonzalez Law Offices, P.A.

If your business is facing a commercial contract dispute (or a potential commercial contract dispute) in South Florida, we invite you to contact us for more information. To schedule a call with an experienced Miami contract dispute attorney at Gonzalez Law Offices, P.A., please call 305-676-6677 or contact us confidentially online today.