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breach of contract

How to Deal with a Breach of Contract

What happens if a partnership is not working between two parties? A breach of contract occurs when a member of one party does not fulfill the terms of a prior agreement. Breach of contract cases aim to make each party whole, a process called rescission. An experienced business lawyer can help if you suspect a breach of contract has taken place in your business partnership.  

Determining whether a breach of contract occurred 

Before deciding whether you need to seek legal action due to a breach of contract, it is crucial to determine if a violation occurred. Three elements must be in place for there to have been a breach of contract. First, there must be a valid and legally binding contract between both parties. Second, one party must have suffered material damages due to the breach, whether it was time or money. Common types of breaches include: 

● Missed deadlines

● Incomplete or unfinished jobs

● Non-payment for services 

● Failure to deliver a product or service 

● Disagreement over contract terms 

● Disputes between business partners or employees 

● Failure to meet the terms of an agreement such as a lease, mortgage, or loan document

The legal process for a breach of contract

Both parties should work together to find a solution to fulfill the terms of the contract adequately. Before any legal action is taken, the complainant should send a demand letter to the offending party to get that person to fulfill the arrangement independently. If this happens, there is no need to seek further action. However, if the issue is not resolved, it is time to get an attorney involved. During a breach of contract case, a lawyer’s primary purpose is to step in and help both parties fulfill the contract as initially agreed. Lawyers then attempt to collect damages due to the breach and restore what was lost during that timeframe. 

Material versus non-material breaches 

Breaches of contract range in severity, and so do the consequences. The damages received depend on the type of breach that took place. Breaches of contract fall into two main categories: material and non-material cases. 

Material breaches 

Material breaches significantly impact the contract’s validity and may make the entire contract void. One example of a material breach would be if someone paid for an item to be delivered to a business but only received part of what was ordered. This type of breach puts the entire contract in jeopardy, and the complainant may sue for the total contract price.  

Non-material breaches

Non-material breaches are less severe and are not as serious as material breaches. You may only sue for damages incurred by this breach of contract with this type of case. The point of a non-material breach is to fulfill the means of the original contract and compensate for damages incurred. 

Breach of contract legal assistance in Winter Park, FL 

The Boutty Law Firm, P.A. has experience negotiating business law and breach of contract cases. If you entered a partnership with another business owner who isn’t meeting their terms of the agreement, it might be time to obtain legal assistance from our experienced attorneys. Call our office at 407-622-1395 to schedule a consultation. 

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mediation

Understanding Mediation Services

When two parties dispute over a civil, corporate, or family matter and cannot agree on a solution together, the help of a legal professional may be in order. However, many people want to avoid the formality and costs of a court proceeding. When this happens, using a mediator may be the best solution to help reach a mutually beneficial agreement.

What is a mediator? 

A mediator is an impartial, third-party entity with no prior relationship to either party that helps settle a dispute. Many mediators are lawyers with special mediation training. Mediation services are a structured and legal way to resolve conflict without a courtroom or a judge’s intervention. Often, mediators are the final attempt by both parties to settle a dispute without a formal courtroom proceeding. During a mediation conference, both parties meet and discuss their disagreement with the mediator. The goal of the meeting is for both parties to sign a settlement. This settlement is then sent and approved by a court. If the parties cannot agree, the case goes to a hearing before a judge or jury. 

Advantages of using a mediator 

The main goal of using a mediator is to use a formal party that is impartial and works to seek a common solution to the problem that benefits both parties. One of the most significant advantages of using a mediator is avoiding the formal court proceeding process and its associated costs. Both parties also control the outcome of their dispute instead of letting a judge or jury decide. Due to this, many people find they are happier with the result than if they would have allowed a judge to decide on the case. 

When to hire a mediator

Mediators work with clients to resolve a variety of conflicts, from divorce proceedings to corporate disputes. Here are a few of the common reasons someone may seek the services of a mediator:

Family law

In Florida, mediators are required for family law proceedings. Family law disputes commonly refer to conflicts during a divorce or estate administration. Mediators can help resolve disputes over topics such as the division of assets, alimony, and parenting plans. 

Corporate mediation 

Corporate mediation services include business disputes between employees, shareholders, and partnerships. One benefit to using a mediator for corporate disputes is the confidentiality avoiding a courtroom provides both parties. A mediator may oversee contract disputes, employment claims, and partnership conflicts. 

Civil disputes

Mediators can help resolve conflict for a large variety of civil disputes. One of the main benefits of using a mediator for a civil lawsuit is that both parties remain in control of the case’s outcome. 

Mediation services at The Boutty Law Firm, P.A.

We use proven negotiation strategies to help settle a wide variety of complex disputes through our mediation services without the formality of a court proceeding. We work with clients in Winter Park and surrounding communities. Call our office at (407) 622-1395 to learn more about our mediation services. 

 

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partnership handshake

Navigating Tax Season for Your Business Partnership

The year 2020 was unlike any other, the effects of which are reflecting in the 2021 tax season. Many who experienced layoffs, furloughs, or opened their own business now face some challenges in tax preparation. Suppose you are one of those who have entered into a business partnership. In that case, you may need some assistance to navigate through this new territory. A Business Law attorney can guide you through the wilderness of this process and help you make the best strategic decisions for your new business.

If you have entered into a business agreement with one or more partners, developing a Partnership Agreement is crucial to its formation. Think of it as your roadmap. Your Partnership Agreement should set terms for the nature of your partnership, define contributions from each partner, and specify how profits and losses are allocated. If you have not drawn up a Partnership Agreement, consider consulting with a Business Law attorney to help you cover all the details.

Understand Tax Reporting for Partnerships

A Business Partnership must obtain a Tax ID number. This number is called an “employer identification number,” or EIN. Since partners aren’t considered employees, don’t expect to receive W-2 forms for them or for your business to report income. A partnership, as an entity, doesn’t pay tax on the income received by the business. Instead, that income “passes through” its profits or losses to the partners. 

One partner is responsible for obtaining and completing IRS Form 1065. This form is a report of earnings or losses only; it is not a return to calculate what individuals may owe. Think of it as a template for gathering information from each of your partners. Subsequently, each member of your partnership must complete and return a Schedule K-1 form to report their individual share of income – gains or losses, deductions, and credits. Due to the financial details required for each partner to report, your Partnership Agreement is crucial in defining how each partner takes ownership and responsibility for your earnings and/or losses.

Lead Your Business Partners

The partner responsible for completing Form 1065 should distribute Schedule K-1 to all partners no later than March 15 so that they may include this in their annual personal returns. When you complete your Schedule K-1, it’s essential that you include:

  • Your employer identification number (EIN)
  • What type of partner you are
  • Your share of profit (or losses) at the beginning and end of the tax year
  • Your share of liabilities at the beginning and end of the tax year 

Schedule K-1 also requires each partner’s input for distributions, deductions, credits, tax-exempt income, and nondeductible expenses. 

Engage with a Business Attorney

Filing taxes for a new business, especially a partnership, can be a daunting journey. Consider engaging with a Business Lawyer to help you navigate tax preparation and find the best solutions for your partnership. The Boutty Law Firm, P.A. has the ability and experience to help your business succeed. Call The Boutty Law Firm, P.A. today at 407-883-1024 or contact us online to schedule your initial consultation.

IRS Tax Information for Partnerships

https://www.irs.gov/businesses/partnerships

Schedule K-1

https://www.irs.gov/pub/irs-pdf/f1065sk1.pdf

Partner’s Instructions for Schedule K-1

https://www.irs.gov/pub/irs-pdf/i1065sk1.pdf

Form 1065: U.S. Return of Partnership Income

https://www.irs.gov/pub/irs-pdf/f1065.pdf

Partner’s Instructions for Form 1065:

https://www.irs.gov/pub/irs-pdf/i1065.pdf

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Power of Attorney

Four Types of Power of Attorney in Florida and What They Mean

Familiarizing yourself with the functions of a power of attorney can help you prepare for the future. An individual who has power of attorney over another can make decisions about that person’s finances, estate, and healthcare. Power of attorney and healthcare power of attorney is used when an individual is incapacitated and unable to make decisions independently. Below, we will discuss the different types of power of attorneys (POA) and when would be the best circumstances to use them.

1.          Durable Power of Attorney

This type of power of attorney is the most common. An individual will be assigned as an agent to oversee various financial and medical decisions for the incapacitated person. This decision can be of any person they choose. It will remain in effect until the person holding the POA revokes it(executing a revocation of power of attorney) or it reaches the expiration date included upon signing the document. The person choosing their POA agent must do so with utmost trust, as they have signed over their rights to legal and medical decisions. 

2. Special or Limited Power of Attorney

If you need an agent to act as your POA, but only for a limited time or for specific purposes, then you will need a special or limited power of attorney. In the agreement for power of attorney, you will want to specify what powers you want to grant your agent and what decisions they should make on your behalf. If you’re unsure of what to include, contact your estate planning attorney for a consultation. 

3. Healthcare or Medical Power of Attorney

Healthcare or medical POA is a type of power of attorney where you authorize a trusted agent the ability to make medical treatment decisions (specifically) on your behalf. There might be a situation where you cannot communicate your wishes. You will want a trusted agent to carry out your predetermined decisions. This type of POA can be set up while building your estate plan and drafting your Advanced Directives. Having your medical wishes in writing can reduce the worry and stress on your family during an already stressful event. 

4. Florida Real Estate Power of Attorney

A Florida real estate power of attorney is a limited POA. It can grant an agent authorization to handle your affairs regarding entering real estate contracts or buying or selling real estate. The best time to explore your medical, legal, and financial estate planning options is when you are healthy. Contact a trusted estate planning attorney at The Boutty Law firm to assist you with your estate planning journey. 

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Dog and cat: estate planning

Estate Planning for Your Pet

What will happen to your pets if you passed away tomorrow?

In this age of uncertainty and turmoil, one thing you can count on is that your pet is there for you. But what if the unthinkable happens? Who will be there for your pet if you die? If there is nothing in writing, your beloved pet could end up in a rescue, shelter, or homeless on the streets. The thought of that is heartbreaking to most pet owners. That’s why your pets’ future care should be in writing as part of your estate plan.

Whom do you want to care for your fur baby?

  Who in your family or circle of friends would be the ideal person to care for your pet? Is that person comfortable with the arrangement? You should speak with your pet’s potential caretaker about special dietary or medical needs, life span, exercise and space requirements, and other needs your pet has. You will also want to gauge their interest. If they look disturbed, uncomfortable, or disinterested, it may be in your pet’s best interest if you move on to the next person. Your duty is to find the ideal situation so your pet will be able to adjust after the trauma of losing you.

How will your pet’s guardian pay for your pet’s needs for the remainder of their lifetime?

After your choice on who will care for your pet has been made, it’s time to consider how much money you should set aside to pay for their future care. Quality pet food, bedding, vet care, grooming, etc., can add up fast. It wouldn’t be fair to expect a friend or family member to foot your pet’s caretaking bills after you die. To determine approximate costs, calculate the annual costs to care for your pet and then multiply that number by the pet’s remaining life expectancy and add extra for medical emergencies. These funds will be willed TO your pet’s guardian and NOT your pet, as pets are legally personal property and property cannot receive money. 

If you are considering leaving a large amount of money to pay for your pet’s future needs, you may want to consider creating a trust and assigning a trustee to manage the money for your pet.

Pet Trust option

A more secure option would be to set up a trust for your pet. With a pet trust, you can put money in a trust and assign a trustee to oversee funds. The trust will assign a trustee and caretaker who will have a legal obligation to care for your pet. If your chosen and dually agreed upon caretaker fails your pet, they may be sued. Your trust will include:

• The name and description of the pets to be cared for.

• The name of the person (trustee) who may be responsible for overseeing the process.

• The amount of money to be used for pet care.

• The name of the person that agreed with you to care for your pet.

• Detailed instructions on the care of your pet.

• Details on what should be done with any money left over after your pet dies

What happens if I cannot find a suitable caretaker for my pet?

  If you are not able to find the ideal situation for your pet, contacting the SPCA of Florida, your vet, or a sanctuary is an excellent way to help you find a program that can help you make arrangements. A stipend may be required to ensure your pet gets the care they need while living their life out in a sanctuary or are adopted out to the perfect family.

Contact your Winter Park estate planning attorney today to modify your will and ensure that your pet is taken care of

The Boutty Law Firm, P.A., is passionate about helping families prepare for life after a loved one dies. With a secure estate plan, you can feel confident that your pet will be cared for in their next home. We serve clients in Winter Park and Orlando and in communities throughout Orange County, Seminole County, Osceola County, and Volusia County, FL. We are committed to building strong relationships with our clients and the community.

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