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Understanding a Tenant’s Right of First Refusal

Tenant's right to first refusalThe concept behind the right of first refusal is fairly straightforward: Contractually, it’s a right granted to Entity A to enter into a business transaction with Entity B before anybody else is able to. If Entity A decides not to take part in the transaction, Entity B is then free to negotiate with other potential buyers. Often, this concept appears in real estate transactions, where the seller grants a certain party the right to purchase a property before anybody else can. Many leases executed between tenants and landlords contain a right of first refusal clause. In Baltimore City, however, a tenant’s right of first refusal is on the legal books, established in Subtitle 6 of Article 13 of the Baltimore City Code. What does the law say? The Tenant Opportunity to Purchase Act (TOPA) maintains that “before title to any single-family residential rental property is voluntarily transferred, the tenant of…

Protect Yourself From Unfair Contracts

Maryland Business Contract LawyerAs a business owner, you will enter into a number of contracts – leases, supplier agreements, employment contracts, and more. You want to ensure that any contract you sign is fair and offers you some legal recourse, should a contract dispute arise. But it’s equally important to make sure you don’t inadvertently create unfair or illegal contracts yourself. The following is an overview of how to avoid signing or creating an unfair contract. Maryland Contract Basics Maryland law recognizes five basic components of a contract: Competent parties – Adults who are mentally capable of understanding the terms of the contract Offer – The proposal by a party to take an action and/or pay for goods or services Acceptance – Approval of the terms and conditions of the offer, as may be evident by the signatures of the parties to the agreement. Consideration – The agreement specifies consideration, which means all…

Maryland man files class action lawsuit against AOL

A Maryland man who is representing himself has filed a class action lawsuit against AOL, which was formerly known as America Online, for breach of contract. The man claims that AOL customer service representatives misled him about subscription services offered by the company, and he also alleges that AOL's practices violate Maryland's consumer protection laws. The man filed his lawsuit on Oct. 29 at a circuit court in Prince George's County, but the case was referred to the U.S. District Court for the District of Maryland on Nov. 24. The venue of the breach of contract case was changed because the plaintiffs and the defendant reside in different states and the damages being sought are in excess of $5 million. The man claims that an AOL representative told him that he would have to purchase a subscription membership in order to receive help recovering emails that he had lost when…

HP sued by MicroTech over software transactions

Maryland investors may have heard about a legal dispute that has developed between Hewlett-Packard and Autonomy. HP acquired the British software company in 2011 for approximately $11 billion, but the value of the company has subsequently been written down amid allegations of impropriety. HP filed a $5 billion lawsuit against Autonomy in the British High Court in April 2015. The lawsuit claims that the Autonomy's founders misrepresented transactions in order to make the company appear more profitable. The legal dispute escalated on May 18 when MicroTech filed a breach of contract lawsuit against HP in California, seeking damages of $16.5 million. The company claims that it paid Autonomy $11 million in 2010 and $7 million in 2011 but never received the software keys necessary to complete the transactions with their end users. An attorney representing the Virginia-based company said that MicroTech wants HP Autonomy to either provide the software as…

Damages available after a breach of contract in Maryland

When one party fails to live up to the terms of a contract, that party is said to have breached the contract. When a contract is breached, the non-breaching party has several remedies at its disposal. One option is to cancel the contract and another is to ask for restitution. If the contract is cancelled, neither party has any further obligation to the other. If the non-breaching party decides to seek restitution, the breaching party would have to pay to put the other party back to the position it was in prior to the breach. There are several different types of damages that may be awarded to the non-breaching party. For instance, nominal damages are awarded when breach occurs but there is no evidence that a monetary loss occurred. Compensatory and liquidated damages aim to put the non-breaching party in roughly the same position that they were in before the…

Elements of a Valid Contract

Contract terms and validity for Maryland residents Maryland residents should be aware of the elements of a valid contract. From business owners to the average citizen, contracts are used by people in numerous aspects of professional and financial life. Few people understand the rules that apply to contracts or how to draft and interpret them. A valid contract is simply one that is legally binding and may be enforced. Although a lawsuit is one possible means of resolving a conflict dispute, it is not a very efficient one in most cases. Contracts are written to clarify the terms of an agreement in such a way that prevents a contract dispute from turning into a lawsuit. A litigious solution to a contract dispute also removes control from the parties at hand and gives it to the court. There are several types of contracts, including oral and written. Both may be legally…

Using a notary to avoid potential contract disputes

Business owners in Maryland will likely be involved in some sort of contract dispute at one time or another. While some of these disputes may be complex in nature and difficult to anticipate, others could be avoided by taking a few straightforward preventative steps. Individuals may sometimes attempt to avoid their contractual obligations by claiming that they never signed the document in the first place, and proving that they did could take time and cost money. This is why it may be prudent to have all signatures on a business contract notarized. Notaries have a commission from state or county authorities to witness and acknowledge a signature. They check the identification of the individual signing the document and then sign the document themselves before affixing a seal. Should the individual later claim that they did not sign the contract, a notarized signature will usually be sufficient evidence for a court…

Waiver of remedy for a breach of contract

Maryland business owners might be interested to learn about special circumstances when a breach of contract does not require a remedy. In general, a party who was involved in a contract that was breached by another party would be entitled to claim remedies for the material breach. However, the aggrieved party may waive its right to receive remedies in some instances. One way that remedies for a breach of contract are waived is through a mutual agreement by both parties to the contract. After the breach occurs, the party making the breach and the aggrieved party may sign an agreement that assures no claim will arise as a result of the breach. A party may also waive its right to remedies for a breach of contract by failing to inform the other party that a breach occurred within a reasonable period of time. In order for the rights to be…

Rising use of non-compete contracts sparks controversy

Well drafted employment contracts are critical for many employers in the Columbia area. Successful companies often recognize that because employment is at-will under Maryland law, it is important to draw some contractual parameters. At-will employment means that both the employer and the employee have the right to terminate employment at any time for any reason that does not violate the law. In many industries, non-compete contracts are a key element of employment contracts. Non-compete clauses are often used to keep a salesperson from leaving the company to work for a competitor, taking along clients and leads. Non-competes are also common in the technology industry where they are used to restrict employee movement in order to insulate companies from the theft of trade secrets and intellectual property. In recent years, however, non-competes have spread into other roles and industries. The New York Times reported about this issue, calling attention to a…