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Prior dealings might establish a contract

On Behalf of | Aug 20, 2022 | business litigation

Business disputes come in many forms. You might disagree with your partner, claim someone violated their confidentiality agreement or have your rights as a worker infringed on.

One of the most common business disputes arises from a breach of contract. In California, a breach of contract happens anytime a party fails to act according to a contractual agreement.

Oral agreements

For business purposes, a breach of contract may occur in several ways. However, in business, the contractual obligations go beyond a written agreement. Many business interactions rely on prior dealings to set a precedent. If your company has a history with another business and expects a certain standard, you do not necessarily need a written agreement to file a breach of contract lawsuit. For example, if you received a product from another company for ten years, and they suddenly change their product without consulting you first, they may be in breach of contract. Many business dealings do not operate with a written contract, but prior transactions count as a type of contractual agreement.

Statute of limitations

Remember that you only have a certain amount of time to file a breach of contract lawsuit. According to the California Courts, oral contracts only have a two-year statute of limitations. So, if you continue to work with a company years after you become unhappy with their product, you might not have legal grounds to stand on.

Agreements you make business to business often come into dispute. Even if you do not have a written agreement, your prior dealings are evidence of a contract between two parties.