Two Florida Collision Shops Sued For Breach Of Contract
Businesses have contracts in place with vendors and customers so that there are sufficiently defined terms and agreements in place that govern their business relationships. When a party fails to uphold their end of an agreement, it can result in breach of contract. When the parties cannot resolve the issue, the non-breaching party can typically file a lawsuit and fight the case in court.
This is what BASF, a chemical company based out of Germany, is doing to two auto collision shops in Florida. BASF has filed two lawsuits against L.M. Auto Collision Center and Brian’s Automotive for breach of contract and unjust enrichment. The collision shops did not follow the contracts, failing to purchase an agreed-upon amount of paint and materials. BASF filed the lawsuits in the appropriate courts on March 7. The following is an outline of the claims alleged in the litigation.
A contract between L.M. Auto and BASF was signed in February 2018. According to the contract, the shop was required to only buy BASF, Glasurit, and RM brand products. L.M. Auto was also required to spend at least $302,000 over a five-year period. BASF paid the shop $80,000 within 45 days from the effective date.
In July 2020, L.M. Auto didn’t pay back what BASF was owed under the terms. BASF informed L.M. Auto of the breach in August 2020 and would pursue additional damages if litigation became necessary. At the time of the alleged breach of contract, the shop had purchased more than $40,000 BASF products. The shop still had more than $250,000 to spend in order to fulfill the contract. This breach meant L.M. Auto had an obligation to refund 110% of the Contract Fulfillment Consideration, or $88,000, to BASF.
BASF is seeking $380,218.44 for the breach of contract and alleged unjust enrichment by L.M. Auto for more than $111,000.
The lawsuit against Brian’s Auto is similar except for differences in dollar amounts. Brian’s Auto agreed to spend $267,493 on BASF products in August 2020. The company also agreed to only buy from BASF. BASF paid the shop $50,000.
BASF claims that Brian’s Auto purchased products from other suppliers, breaching the contract. To date, Brian’s Auto has bought about $35,000 in BASF products.
Under the terms of the contract, Brian’s Auto must refund 110% of the $50,000 Contract Fulfillment Consideration to BASF, amounting to $55,000. It must also pay BASF $34,296 for the value of the loaned equipment.
According to BASF, Brian’s Auto was informed in October 2022 that it had breached the contract. BASF also contends that the shop was unjustly enriched by not fulfilling the contract. BASF is seeking $322,315,07.
Contact a Business Litigation Lawyer Today
Contracts are created for a reason. They help each party understand their obligations. When a party does not follow the contract, they can be sued.
Contract law can be tricky. A Bradenton business litigation lawyer from Cahall Law Firm can identify legal issues with your contract. Schedule a free consultation by filling out the online form or calling (941) 281-2019.