When individuals or companies enter into business transactions, disputes often arise. Sometimes, the parties can settle them. However, if a resolution satisfactory to all parties is not possible, one or more of the parties involved may file suit. Business related lawsuits are commonly referred to as commercial litigation.
Commercial litigation may be necessary in a variety of different situations. Here are some common examples:
- Contract Disputes: The parties to a business transaction often sign a contract establishing the obligations of each participant. If one party fails to comply with the terms of the contract, the other may sue in court. The purpose of the suit is usually to force the breaching party to comply with the terms of the contract, either by paying money or performing the obligations required under the contract
- Debt Collection: In some cases, one party may sue the other simply to collect a debt. For example: promissory notes, guaranty agreements, mortgages and credit card contracts
- Securities Law Violations: Various state and federal laws exist to protect individuals who are defrauded in connection with the buying of stocks, bonds, mutual funds, oil and gas and similar securities.
- Fraud Related Suits: Commercial litigation is often the only remedy in cases when one party has defrauded another in a business context. Fraud occurs when one party makes a false representation (or fails to disclose a pertinent fact) to another party in order to induce them to perform some act. A common example is a real estate agent who convinces a client to purchase a house by telling him or her that the house is in excellent condition, when the agent knows it has serious foundation problems.
- Deceptive Trade Practices Act Suits: This law protects consumers who have been the victims of fraud, usually by a business, and can be very effective in obtaining a satisfactory result
- Abuse of Trust: The law recognizes situations where one person, called a fiduciary, is bound to act in good faith and may not place his own interests above those of the person to whom he owes a duty. Examples of fiduciaries may include business partners, trustees, stockbrokers, and agents of various kinds. When a person has a fiduciary duty to you, if he or she fails to meet that duty, you can sue.
- Employer/Employee Disputes: Employers and employees may become involved in suits regarding employment contracts, health and pension benefits, or discrimination (age, race or gender).