In order for a business to grow and prosper in this economy, businesses routinely have to borrow money, typically in the form of loans. However, there are times when a business may be unable to repay its loan and a contract dispute might arise.
Louisiana residents and business owners may find it interesting to learn that a contractor recently filed a lawsuit against a construction firm for failure to pay back a loan. The contractor, KMT Painting and Decorating, alleges in its lawsuit,that it entered into an oral agreement with Inman Construction Services wherein KMT would give ICS about $30,000 in the form of a loan. KMT’s lawsuit was filed in the Orleans Parish Civil District in early December, 2013
KMT alleges that ICS wrote a check in the original amount of $30,000 to it sometime in November of 2010. Accordingly, after receiving the check, KMT proceeded to deposit the check in its back account. However, about a month after the deposit was made, the bank dishonored the check. Almost three years later, KMT demanded the money from ICS by sending a written request for payment of the loan by certified mail. However, the certified letter was returned back to the sender.
In its current lawsuit over the contract and failure to pay the loan dispute, KMT alleges that ICS breached its obligation to repay the loan, and is seeking about two times the amount of the loan amount, as well as an additional five percent service charge.
Contract disputes between businesses can arise for numerous reasons. When a dispute arises, the matter can get convoluted and in some cases, complex. It may be necessary to have a law firm familiar with written and oral contract agreements to evaluate the facts and develop a legal strategy.
Source: The Louisiana Record, “Construction company sued over $30K loan,” Elizabeth Fitzsousa, Feb. 25, 2014