By: Howard S. Goldman, Esq.
According to a study conducted by the Governor’s Alternative Dispute Resolution Working Group, 97% of all cases settle without a trial. Nevertheless, experienced litigators know that much effort is required to develop a case to the point where settlement can be reached. This article focuses on the essential considerations in business litigation and some effective tools to encourage speedy resolutions.
A carefully thought out contract is the first step toward facilitating a settlement in the event of a contract breach. When entering contractual matters, ranging from remodeling a home to obtaining payment for business services rendered, one needs to execute a contract, in writing, and be unambiguous in describing the services to be rendered and the time in which payment is to be tendered. The document should also state the accurate parties to the contract, such as an individual or a corporation, and whether a penalty will be imposed for a breach, such as interest and costs of collection. Additionally, if time is of the essence, a commencement and completion date should be stated.
If a valid and binding contract has been breached, written notification to the other party should be made to preserve timely objection. The breaching party should then be approached to remedy the defects so as to avoid intervention by third parties. Having failed with this approach, a formal lawyer’s demand letter should be sent, promptly, outlining the remedies if default continues. In those cases where the breach is so egregious that it constitutes an unfair and deceptive trade practice, the Massachusetts legislature has enacted a tough remedy to provide a doubling or tripling of actual damages as well as costs of enforcing these rights. This statute is known as Chapter 93A and has been widely used in litigation in Massachusetts courts.
The Rules of Civil Procedure permit a plaintiff to aver several legal theories of recovery. A Chapter 93A count as well as contract breach, breach of a specific statute and promissory estoppel would typically be included in the complaint. The complaint is filed with the court which has jurisdiction over the plaintiff, defendant, and the subject matter. Subsequently, the complaint and summons are served upon the defendant, in hand, by a sheriff.
One procedural technique to affect a speedy resolution is to attach assets of the defendant. This is accomplished by demonstrating to the judge that the plaintiff has a reasonable likelihood of prevailing on the merits of his/her case. Procedurally, a motion is made to the court for an attachment upon the defendant’s real estate or for a trustee process of the defendant’s bank accounts. The attachment or trustee process prevents the defendant from conveying the subject real estate or from spending the frozen funds. In some instances, this action will default the defendant under contractual arrangements with third parties not having any relationship to the plaintiff. These third parties can force the defendant into a speedy resolution of the litigation.
Another technique is to motion the court for summary judgment. This is a procedure which summons the defendant into court shortly after the complaint has been served to explain what facts of a material nature exist that would prevent judgment in favor of the plaintiff as a matter of law. Thus, the court is able to “look behind” the pleadings to determine whether genuine issues of fact exist to warrant a trial. Furthermore, a summary judgment bifurcates any extraneous counterclaims raised by the defendant that do not arise from the concise issues of liability on which the action was brought. The impact of the summary judgment motion is that final judgment, without a trial, is entered against the defendant who has no valid defense.
Finally, requesting a pre-trial conference may also help to expedite a resolution between the parties. At such conferences, the court attempts to simplify the issues in dispute, obtain documents and admissions of fact to avoid unnecessary proofs, and limit the number of expert witnesses.
Before deciding to litigate a disputed contractual matter, one’s objectives should be balanced against the realities of a courtroom battle. Given the determination to litigate, a thoroughly written contract forms the basis from which certain legal procedures, such as attach- ments, trustee process, summary judgment, and pretrial conferences can be employed to encourage the breaching party to settle. In light of the high cost and time demands of litigation, an expeditious settlement would be best for all concerns.
The Boston metro lawyers at Goldman & Pease specialize in business law, real estate law, condo law, civil litigation, and estate planning and serve the greater Boston metro region including Alston, Arlington, Belmont, Brighton, Brookline, Cambridge, Canton, Dedham, Dover, Milton, Natick, Needham, Newton, Norwood, Waltham, Watertown, Wayland, Wellesley, Weston, West Roxbury, Westwood, and all of Massachusetts.