A Small Business Gets Served With a Lawsuit by a Vendor for Breach of Contract

Your small business is being sued by a vendor for breach of contract. Now what?

Being served with a summons and complaint is every small business owner’s worst nightmare. No matter who filed it, a lawsuit against your company can be stressful, expensive, and time-consuming. When the plaintiff is a vendor, it impacts the supply chain that you rely on to serve your customers and stay in business. What you do next is critical, so we’re presenting an overview of steps you should take as soon as you receive those court papers.

Common Vendor Disputes

A vendor contract defines the terms and conditions of the relationship between the vendor and the business owner. Although every agreement is unique, most include the following:

  • Each party’s respective rights and obligations
  • Actions that constitute a breach
  • Available remedies in the event of a breach
  • Provisions for arbitration or mediation
  • Termination provisions

When either party fails to honor their obligations under the contract’s terms, they can suffer revenue loss and harm to their professional reputation, which is why breach of contract lawsuits are comparatively common in Florida courts.

If You’ve Been Served, Contact an Attorney

When you receive the lawsuit papers, the first thing you should do is consult with an experienced business lawyer who will review the allegations and advise you on the best way to respond.

You will definitely want to preserve any records related to the vendor’s claim, no matter how tangential. They include paper documents and electronic materials such as emails, voice messages, and digital paperwork like invoices and receipts. Suspend any document destruction policy until you speak with your lawyer.

Does Your Contract Have a Mediation or Arbitration Clause?

Many business contracts specify that disputes be handled through mediation or arbitration. If this is the case with your agreement, work with a Florida small business lawyer who’s experienced in alternative forms of dispute resolution.

Attorney Rich Sierra has extensive experience representing clients through mediation in particular. His experience and expertise in business law can assist you in effectively communicating your viewpoint and achieving a mutually beneficial outcome.

Let Your Attorney Do the Talking

The plaintiff can use anything you say about the lawsuit against you, so don’t call or email them even if you believe they made a mistake that can be easily cleared up. The time for talking things out and working things out amiably ended when they filed suit, so you should only communicate through your lawyer. You should not contact the plaintiff to attempt to resolve the issue on your own.

Let Up Help You Protect the Future of Your Business

At the Florida Small Business Center, our business litigation practice handles a wide range of contract disputes for clients in various industries. Our goal is always to resolve the matter in as stress-free and cost-effective a way as possible, so that the impact on your bottom line is reduced. To schedule a consultation with Attorney Rich Sierra, call the Florida Small Business Center at 1-866-842-5202.

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