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Florida Appeals Court Rules Contract Language ‘Unambiguous’, Enforces Agreement

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On July 10th, 2019, the Fourth District Court of Appeal for the State of Florida found that a termination provision within a contract was not ambiguous. As a consequence, it upheld the contract and allowed Marriott to terminate the agreement. In the case of Corporate Creations International v. Marriott International, the West Palm Beach-based appeals court declined to review ‘extrinsic evidence’ presented by the other party. Below, our Miami business litigation attorneys offer an analysis of this decision.

Case Review: Corporate Creations International v. Marriott International  

The Facts 

Corporate Creations is a company that provides registered agent services along with corporate

document filing and document retrieval services. Marriott International, a global hospitality giant, entered into a commercial agreement with Corporate Creations. The contract included an early termination provision that allowed each party to get out of the deal. This specific language was as follows: parties have the right to “terminate the Agreement with or without cause and without liability.

The initial agreement ran for a period of seven years. However, in the fifth year of the contract, Marriott notified Corporate Creations and stated that it was exercising its early termination option. The contract was immediately cancelled. Corporate Creations responded by filing a breach of contract lawsuit against the hotel company. 

The Key Legal Issue 

The fundamental legal issue at stake in this case was whether or not the termination clause contained within the contract was valid. For its part, Corporate Creations argued that the provision could not be enforced because it was “ambiguous”. More specifically, the company claimed that other sections within the contract and outside evidence raised questions regarding how the early termination clause should be interpreted.  

The Decision 

Upholding a decision made by a Palm Beach County Circuit Court, the Fourth District Court of Appeals ruled in favor of Marriott — determining that the company had the right to terminate the contract at will, for any reason. In making the decision, the appeals court noted that Florida laws require a plain language reading of the agreement.

The specific provision was unambiguous, and there was no real room for reasonable minds to differ. Under previous case law, courts will not consider “extrinsic evidence” interpreting the meaning of unambiguous contract language. The actual terms contained within the deal will be upheld.

The Takeaway

The decision provides another important lesson for businesses in Florida: precise contract language matters. Whenever possible, Florida courts will uphold the terms of the agreement. If your company is engaged in commercial negotiations, it is essential that you have a professionally draft, carefully reviewed contract. .

Get Legal Advice From Our South Florida Business Litigation Attorneys Now

At Pike & Lustig, LLP, our Florida business law attorneys have deep experience handling contract litigation. If you or your company is currently locked in a contract dispute over potentially ambiguous contract terms, we are here to help. To set up a strictly private consultation with a top-rated business lawyer, reach out to us right away. We represent clients from our office locations in West Palm Beach, Miami, and Palm Beach Gardens.

Resource:

4dca.org/content/download/531548/5899424/file/182614_1257_07102019_08555528_i.pdf

https://www.turnpikelaw.com/tips-for-negotiating-commercial-agreements-with-independent-contractors/

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