Payton & Associates, LLC
Commercial Litigation Attorneys
Miami, Florida

Construction company awarded $2.5 million in business litigation

Forming a business relationship can be a profitable endeavor if things go as planned on a project. However, when a project is derailed due to unexpected circumstances, a business relationship can quickly sour in Florida or in any other state. This seems to be what happened between a construction company and the owner of a hotel, resulting in a business litigation lawsuit.

The conflict revolves around the opening of a new hotel that was created from a former warehouse that is approximately 100 years old. The hotel company had already paid the construction company over $10 million for its work on the hotel. However, the construction project was not going as scheduled, which delayed the hotel's planned opening that was supposed to coincide with a large Harley Davidson anniversary event.

The hotel owner desperately wanted to open the hotel for this particular event because the hotel was designed to be a motorcycle friendly establishment, which would have fit perfectly from a marketing perspective with the Harley Davidson event. The construction firm loaned the hotel owner $400,000 in order to attempt to open the hotel on schedule. However, the loan contract came with an interest rate of 30 percent per year and gave the construction firm the right to collect 60 percent per year after any default in payment. Unfortunately, the hotel was still not opened on schedule and the hotel owner ended up defaulting on the loan.

The construction firm filed a business litigation lawsuit in order to collect a debt which had increased to $2.5 million. The defendant attempted to argue that the high interest rate was illegal, however a judge did not agree and ordered the defendant to pay $2.5 million to the plaintiff. This case illustrates that filing a lawsuit is sometimes required in order to enforce a business debt obligation in Florida or in any other state. However, one will need to have a strong understanding of contract law as well as any other relevant laws in order to prevail.

Source:, Iron Horse Hotel owner Dixon ordered to pay $2.5 million judgment, Rick Romell, Aug. 29, 2013

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