BTG Files Breach of Contract Lawsuit for Unpaid Commissions
A common legal issue we see at the Business Trial Group (BTG) is one party to a contract approaching the agreement as if it can be renegotiated after the fact. Too often, businesses and their owners think that they can maximize their profit by paying less than what they owe to the people that actually did the work.
Recently, our attorneys were hired to represent a client, Jarr Enterprises, LLC (Jarr Enterprises), that was not paid compensation and commissions owed to them by UCMS, LLC (Universal Contracting). Universal Contracting, a company performing storm damage recovery and repair throughout Florida, is owned and controlled by Jeremy and Nicole Kinsworthy. Universal Contracting operates under several names, including, among others, Universal Contracting, Universal Contracting Florida, and Universal Contracting of Florida.
After our client performed work for Universal Contracting and made the business a tremendous amount of money, Universal Contracting tried to unilaterally modify the contract. When our client refused to agree, Universal Contracting withheld payment of commissions and terminated the contract.
There’s a simple reason why businesses sometimes fail to pay contractors in full: they think they can get away with it because litigation is often more expensive than simply taking the loss. But this strategy fails when contractors hire the Business Trial Group, which handles all cases on a contingency-fee basis.
Universal Contracting Allegedly Liable to Jarr Enterprises for Nearly $500,000
After Universal Contracting failed to pay Jarr Enterprises what it was allegedly owed, on March 27, 2019, BTG attorney Aaron C. Garnett filed a lawsuit against Universal Contracting for breach of contract to recover the unpaid commissions. According to the Complaint filed on March 27, 2019, Jarr Enterprises performed services for Universal Contracting and Universal Contracting failed to pay for those services.
Per the parties’ agreement, for each contract that Jarr Enterprises obtained for Universal Contracting, the parties would split the profit 50/50, less the cost of materials, labor, a 10% office fee, and building expenses. The contract also stipulated that Jarr Enterprises could build a sales team, and would receive its commission from Universal Contracting regardless of who on Jarr Enterprise’s sales team sold the contract.
During 2018, Jarr Enterprises and its sales team obtained dozens of contracts for Universal Contracting, the Complaint states. These contracts created enormous revenue for Universal Contracting, but Universal Contracting and its owners allegedly wanted more. Ultimately, around January 2019, Universal Contracting attempted to unilaterally change the terms of the parties’ contract so that Universal Contracting would generate even more revenue. The Complaint states that Jarr Enterprises refused to allow Universal Contracting and its owners to bully it and unequivocally rejected the unilateral changes. Subsequently, Universal Contracting withheld payment to Jarr Enterprises and terminated the contract.
The Complaint further states that not only does Universal Contracting owe Jarr Enterprises for commissions earned during the contract period, but it also owes additional compensation as a result of continuing to use Jarr Enterprises’s sales team to obtain leads in 2019.
Nonpayment as a Calculated Business Strategy
As BTG has previously written about, well-funded litigants can exploit contract law to avoid paying contractors.
Because capable contract lawyers typically charge hundreds of dollars per hour, legal fees from a business lawsuit can easily reach hundreds of thousands of dollars. This creates a no-win situation for the business who has not been paid in full. They may forego a lawsuit altogether, settle their case for less than it’s worth, or even go out of business from legal fees.
Unscrupulous business owners can use the high cost of attorneys’ fees as leverage to pay less than what is owed. But this strategy does not work when you hire the Business Trial Group. Contingency-fee litigation from BTG allows businesses to see a nonpayment lawsuit through all the way to trial, if needed.
Our business attorneys have a proven track record of winning contract litigation disputes. For example, we have recovered money for recruiters who were not paid compensation by employers; real estate brokers with unpaid commissions; sales representatives owed commissions; and defrauded developers.
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No matter what type of contract work you do, if another party breached the contract and you suffered losses as a result, legal action might be a proper next step. Our business clients don’t have to worry about high hourly attorney fees as a barrier to justice. We charge no hourly fees, and no fees at all unless we recover money for you.
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