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Cleveland Business & Commercial Law Blog

Contract disputes can affect company production

Businesses often rely upon vendors to supply necessary parts to produce the end product. While the Ohio business and the vendor may be physically thousands of miles apart, they still have a working relationship and often a contractual obligation with each other. Most of the time things go smoothly and both parties uphold their end of the agreement; however, there are times when there are contract disputes and the company needs legal clarification and/or assistance to remedy the situation.

In one recent situation, a contract dispute resulted in a production stoppage of a company's product. At the center of this dispute are Pratt & Whitney Canada, an aircraft engine manufacturer, and Nordam, an aerospace company. Nordam has been contracted to build component parts to be used in the production of Gulfstream Business Jets. However, as a result of the contract dispute, Nordam has ceased production.

Tips for smooth commercial real estate sales

Many in Ohio and beyond are discovering the benefits of owning commercial property. Real estate as an investment can add diversity to a retirement plan and offer an interesting and flexible source of income. However, there may come a time when a commercial property owner decides to place one of his or her investments on the market. When selling a commercial property, it is a good idea to be aware of some common mistakes in order to avoid them.

Since tenants are the lifeblood of a commercial property owner, it is important for the seller to reveal to a potential buyer any relevant information about the tenants of a building. This includes alerting a buyer if any tenants are in default of their rent or if there are tenants who are leasing month to month. These issues may affect the way the buyer's lender recognizes the income from those properties.

Employment contract disputes and expectations

Employees are an important part of the Ohio business. They often have the talent and expertise needed to allow the company to continue to grow and thrive. After investing time and money in locating and training the desired individual, the company wants to ensure that the working relationship will be a smooth one. In order to avoid potential problems down the road, such as employment contract disputes, employers and employees often enter into an employment contract.

The purpose of the employment contract is to specify the expectations of both parties. It often specifies exactly what duties the employee will be expected to perform. Additionally, it often identifies the days and hours that the employee is expected to work. Furthermore, it can address wages, commission, benefits and even duration of employment if applicable.

Planning for future critical to business organization

Customers and employees are the lifeblood of many Ohio businesses. They are both critical parts of most businesses. As such, the business owner often goes to great lengths to make sure that both are taken care of. Unfortunately, without proper planning for what will happen to the business organization if the owner dies or becomes incapacitated, customers and employees can suffer.

Depending upon the structure of the business, it is possible that there will be no one legally able to make business or financial decisions if the owner is unable to. One way to avoid this problem is by transferring business assets into a trust. The current business owner can then act as the trustee, thus maintaining control of the business. Then, if the owner dies or becomes incapacitated, a successor trustee who was previously identified, can step in.

Breach of contract dispute goes before jury

At some point in time, it may be necessary for an Ohio business to hire another company to perform tasks for the business. In some cases, this may be a short-term assignment that is handled by a simple phone call and payment for work completed. In other cases, it may be a more involved assignment, and the companies enter into a contract stating what will be done and how much will be paid for the services rendered. When this happens, it is assumed that both parties will live up to the terms of the contract; otherwise, they risk a breach of contract dispute.

In 2009, a grocery store chain hired another company to work on reducing its tax obligation. The contract indicated that the company would receive 25 percent compensation for tax savings it was able to secure. In 2012, the grocery store chain was informed that it owed $4.6 million in taxes. After review by a state auditor, this number was adjusted to $2.15 million. Later, state officials reviewing the matter discovered a mathematical error which further reduced the amount owed to a little over $1 million.

Acquisition of all 4 corners important to one Ohio developer

Location is key in most Ohio business ventures. The right location can be essential to the success of the business. For this reason, the acquisition of the desired property is often the first step in business development and/or expansion.

One Ohio developer, Uptown Consortium, has apparently recognized the importance of location in its ongoing business development. In fact, it recently purchased a piece of property that was home to a Marathon gas station. However, it did not want the property for the gas station. In fact, the gas station has now been torn down and removed from the property.

Business structures to consider in business formation process

Starting a new business can be a daunting venture, yet the personal and financial rewards can be extensive. Thus, many find the challenge to be worth the investment. Once the decision to begin a new business is made, there are a number of decisions that the Ohio entrepreneur needs to make in the business formation process.

Other than what product or service the business will provide, perhaps the most important decision the entrepreneur will make is what structure the business will take. This decision can impact the required documentation the business will need, its recording keeping needs, the taxes it will be responsible for paying and even the liability the business and its owner or owners will incur. Through a careful analysis of the different types of business structures, and consultation with experienced legal counsel, the entrepreneur can make an informed decision.

Shareholder disputes cause controversy within CBS

Investors, stockholders and board members all have a vested interest in businesses with which they are associated. In each case, the individual is often motivated to do what he or she believes will provide the greatest return to both the company and the individual. As a result, these individual can disagree about how specific business decisions and funds are handled, thus leading to shareholder disputes within the Ohio business.

Recently, CBS has found itself at the center of a dispute with one of its major shareholders. At the center of the dispute is a vote regarding dividends to be paid. If the vote passes, National Amusements will effectively lose some of its voting power. The shareholder principally involved in the dispute is the current president of National Amusements.

Financing an important component in business planning

Money is an important part of doing business. For those Ohio entrepreneurs just getting started, obtaining the funds necessary to begin operation is critical; for those Ohio businesses looking to expand, funding is also needing to make this possible. When it comes to business planning, finances and financing play an important role.

Small Business Administration (SBA) loans are a popular avenue for small businesses just starting out. These loans are a staple of many community banks and offer favorable terms to businesses who do not have a lengthy credit history. This often includes new businesses and entrepreneurs needing to establish a solid history of timely payments. Records indicate that in recent history, almost 50 percent of SBA loan requests were approved.

Breach of contract claimed in employment dispute

Skilled employees are an asset to Ohio businesses. Companies often depend upon them to provide customer service, provide training to customers and other employees, solve problems and a variety of other important business activities. Truly skilled employees are not found every day, and as such, when they are discovered, their contribution to a company is essential. Many companies recognize this possibility and thus enter into employment contracts with employees. While this may be good business practice, it can also lead to breach of contract concerns if the employee and/or company decide to part ways.

In one recent instance, an individual who was hired to promote, manage, train and perform as a fighter in his local gym has been sued for breach of contract along with several other claims. According to his former employer, this individual was under a three-year contract with a noncompete clause. However, the individual left the gym during the contract period and began working at another gym in the same town.

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