Restaurant owner and contractor in contractual enforcement clash
New Jersey business owners may understand how frustrating it is when construction of their new offices or places of business are not completed as planned. One restaurant owner felt the same frustration after a contractor failed to finish a remodel on time. As a result, the owner of Kuroshio is refusing to pay the contractor and his employees, causing a battle over contractual enforcement.
The main issue at hand is that the restaurant remodel was supposed to be completed by September 30. However, due mostly to issues with the heating ventilation and air conditioning system, the project was delayed. The restaurant did not get the certificate of occupancy until December 31. As a result of the delay, the owner has refused to pay allegedly $35,000 in wages to the contractor and his employees. Protestors have been holding signs outside the restaurant every night since March 16.
According to the restaurant owner, the contract imposes a hefty penalty for every day that the project is late. However, the contractor claims that the restaurant owner should hold up his end of the contract, since he and his employees did complete the work.
The contract also states that any delays must be communicated in writing. The contractor said he failed to do so, but was under the impression that the delay was understood. He simply wants money for the work completed.
Individuals and small to medium size businesses use contracts as an integral part of day to day business. When a party does not follow through with their side of the agreement, enforcement and recovery of damages are an essential step in resolving the dispute. A party can file a lawsuit to recover any damages. If the amount of money is relatively small, the parties do have the option to file a claim in small claims court. In addition, alternate dispute resolution options like mediation may be a viable option to resolve the contract dispute. That being said, professional help is also an important option, particularly in cases that involve contracts with higher monetary values. Other business law disputes involving contracts may include commercial litigation, shareholder disputes or real estate transactions.
Source: AnnArbor.com, " Contract dispute leads to frustration for Kuroshio restaurant owner and protesting contractor," Ben Freed, March 24, 2013