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Effective Tips to Help Review Contracts
You should never sign a contract until you’ve performed a full and thorough review. However, if you are inexperienced with contracts, it can be difficult to distinguish between routine and important contractual issues. In this article, we discuss some key things to look out for when reviewing a contract.
Client alleging accountant malpractice must show that there was a departure from the accepted standards of practice
In response to a client's allegations of malpractice, the Court--in Dean v. Brodman, 2021 NY Slip Op. 01842--held that the accounting firm was able to show that it followed accepted standards of practice when it prepared the client's tax information. The Court stated that an accountant may rely...
Strategies for Settling Common Business Partnership Disputes
A common risk of business partnerships is that they may deteriorate and become adversarial. When this happens, the business relationship isn’t the only thing that is at risk. In addition to the deterioration of the partnership itself, business partnership disputes often result in significant financial losses, tarnished reputations, and bad feelings all...
Benefits of Alternative Dispute Resolution
Litigation isn’t the only way to resolve a legal dispute. Rather than risking a lengthy and expensive court battle, parties may attempt to resolve their differences by agreeing to participate in alternative dispute resolution. Common alternative dispute resolution methods include mediation, negotiation, and arbitration. In this article, we examine the many benefits...
Contract signed by a yet-to-be-formed entity is binding on its principals (owners) and the contract’s counterparty
In Sutton v. Houllou, 2021 NY Slip Op. 08211, the Appellate Division, Second Department held that a party who entered into contract with a company that had not yet been formed cannot avoid its obligations under the contract. Conversely, the individual who signed the contract using the name of a company that had...
Liquidated (specific amount of) damages for breach of exclusivity clause . . . upheld
In Raven Capital Mgt. LLC v. Georgia Film Fund 72, LLC, 2021 NY Slip Op. 30393(U) [Case Index # 652463/2020], the court upheld the liquidated damages clause (termination fee) in the parties' contract (which was a Term Sheet that required only that the business intermediary and the potential buyer...
M&A intermediary not entitled to success fee, but was entitled to compensation for actual services
In Sonenshine Partners, LLC v. Duravant LLC, 2021 NY Slip Op. 01135, the court held that an exchange of e-mails--when combined with a contract on a related topic, could serve as the basis of an unjust enrichment claim. An unjust enrichment claim is available to a party to receive...
M&A considerations for private companies during the Covid-19 Era
INTRODUCTION
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The virus that causes COVID-19 has ushered in unprecedented times for our country and our global community. Certainly, the pandemic is impacting the way M&A transactions are looked at, papered, implemented, and even priced. This article identifies some of the higher-level, pandemic-related considerations evolving in the private...
M&A anatomy of an Earnout in the Covid-19 Era
IN BRIEF
Amidst the COVID-19 pandemic, parties to M&A transactions are likely to use earnouts more frequently.What are the complex components of a well-structured earnout, and what are some best practices for designing earnouts to minimize disputes?
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