Business Law Definitions

On this page:
Contractual Disputes
Customer Disputes
Supplier Disputes
Internal Disputes
Implied Authority
Commercial Lease Dispute
Right To Quiet Enjoyment
Intellectual Property Litigation
Bankruptcy Proceedings
Winding Up Proceedings
Default Judgments
Letter Of Demand
Garnishee Orders
Attachment Of Earnings
Attachment of Debts

Contractual Disputes

A contract is a legal document between multiple parties which outlines in detail the terms of the transaction in question, ensuring that all parties know exactly what they are agreeing to.

Ideally, a well drafted contract would allow said parties to go about business without having to look back at it once signing. However, this isn’t always the case and contractual disputes occur when different parties have conflicting ideas over what terms laid out in the contract actually mean, or one of the parties breaches the contract agreement. When this happens, one party may seek damages against the other.

Contractual Disputes can occur in a number of business contracts, from supply and licensing agreements, to commercial leases and shareholder agreements. Read our article covering contract disputes and the termination of contracts & agreements here.

Customer Disputes

Customer disputes occur when a customer disputes a debt with the supplier. Disputes can arise for a number of reasons, such as when the customer fails to make payment to the supplier, or if the customer seeks to raise a contractual set off or counterclaim against the debt owed.

When such disputes arise, it’s advisable to seek legal help and commence customer dispute resolution proceedings, to solve the issues as quickly as possible. More information about contractual agreements can be found here.

Supplier Disputes

Supplier disputes can relate to either the breach of supplier contracts or issues with the supply itself, such as defective goods, delivery times not being met, or the provided service not meeting the standard set out in the original supply agreement.

As many businesses rely heavily on suppliers of goods and services for their day to day operations, resolving suppliers disputes quickly and efficiently can be detrimental to a businesses success. In most cases, it’s best to contact the supplier directly, and try and solve the dispute without the need for legal assistance, but if this isn’t possible CBL can provide supplier dispute resolution services covering areas such as a letter of demand, arranging court proceedings etc.

More information about general contract agreements here.

Internal Disputes

Internal disputes within a company arise from disagreements between the company’s directors, shareholders and partners with regards to the rights and obligations of the parties and in relation to the agreements set out upon establishing the company.

Internal disputes could occur due to a number of issues such as the directors of a company not agreeing on certain legal proceedings, through to conflicts of interest between the company and a particular shareholder or director.

When such disputes arise within a company, it’s advised to seek legal help and proceed with the internal dispute resolution process to resolve the issues as quickly as possible. More information on internal disputes can be found here.

Implied Authority

Implied authority refers to an agent, such as a company's partner or director, who has the implied ability and authorisation to perform acts within reason, that are necessary for the company. Implied authority allows said agent to act as the ‘name’ of the company, and gives them the ability to create legally binding contracts on its behalf.

Read more about the implied authority of company directors here.

Commercial Lease Dispute

Commercial lease disputes are disagreements between landlords and tenants regarding leases and licenses on commercial property. Disputes can include the early termination of a commercial lease by the landlord, breach of the ‘right to quiet enjoyment’ clause etc.

There are a number of factors which both landlords and tenants need to consider before signing a lease contract for a commercial property, and it’s advised to do thorough research and due diligence checks before signing.

Right To Quiet Enjoyment

The right to quiet enjoyment of property is a clause ensuring that the tenant can use the property as agreed upon (either commercial or residential space), without any unwanted interference from the property owner. This clause ensures that the tenant can reside or conduct business in a peaceful and private manner, and also ensures that the landlord keeps the property in good, habitable condition throughout the duration of the lease.

Intellectual Property Litigation

Intellectual property litigation includes infringement proceedings or the defence of infringement proceedings surrounding intellectual property rights (IPR) for offenses such as copyright infringement, breaches of trademark, patent infringement, and general IP licensing disputes.

More information on litigation and disputes can be found here.

Bankruptcy Proceedings

Bankruptcy proceedings begin after a bankruptcy notice has been issued against the debtor by an application made to the Insolvency and Trustee Service of Australia. The debt needs to be a minimum of $10,000, and the notice can only be issued if there has been a final judgement debt order has been made against the debtor.

A bankruptcy notice may spur the debtor to pay back the money which they owe, which they need to do within 21 days of it being issued (or make suitable payment plan arrangements). If not resolved after 21 days, the creditor may commence bankruptcy proceedings in either the Federal Court or the Federal Magistrates Court.

More information about bankruptcy proceedings and monetary court orders can be found here.

Winding Up Proceedings

Winding up a company is the process of dissolving a business and liquidating (selling off) its assets, which can either be voluntarily or by court order following winding up proceedings in the Supreme Court or Federal Court. Winding up proceedings can only be brought following service of a statutory demand by one of the company's creditors, in order for them to try and recoup their financial losses.

Winding up proceedings can only be commenced if the debtor has neither applied to set aside the demand within 21 days of the statutory demand being served, or if they haven’t paid back the amount owed (over $2000). After this period, application for winding up can be made.

Default Judgments

A default judgment is entered when one party in a ‘dispute’ (such as the debtor), fails to take action, file a defence or respond to the statement of claim made by the other party (such as the creditor). Once issued, a default judgement in Victoria is generally enforceable for 15 years from the date in which it entered in court.

The time period to file an appearance or a defence from the date on which a Complaint or Writ and Statement of Claim is served varies, in Victoria, depending upon whether the matter is being heard in the Magistrates Court, County Court or Supreme Court. However, the defendant has the option to seek to set aside default judgement, or an order entered in default of defence, if they can establish before the court that they have a valid reason for not filing a defence on time, an explanation for any delay in making application to set aside the default judgement, and most importantly if they have a valid defence which they can still put forward, thus putting them back to the same position where they are able to file a defence in the proceeding.

Read our detailed article about entering default judgements here.

Letter Of Demand

A Letter of Demand is a written request sent from a creditor to a debtor who has been unsuccessful in collecting the money which is owed to them. Issuing a demand letter for payment is often the final step in the debt recovery process between two parties before legal action is taken. A letter of demand includes the amount of money owed by the debtor, and often threatens legal action if the debt owed isn’t paid by the date which has been issued by the creditor.

More information on the letter of demand can be found here.

Garnishee Orders

A garnishee order for debts is a court order which allows creditors to recover money owed to them (known as judgment debts) by a debtor, from third party sources, such as their bank accounts or directly from their salary. All financial institutions and employers are legally obliged to pay the creditors once receiving a garnishee order.

Attachment Of Earnings

An attachment of earnings order (or garnishee order over wages), is a court order which allows for money to be directly taken from a debtor's salary or wages in order to pay off the debt owed to the creditor. Note that if any other form of debt recovery court order is already in place, the attachment of earnings order application cannot be made.

More information about attachment of earnings and monetary court orders can be found here.

Attachment Of Debts

An attachment of debts order (or garnishee order over a debt), is a court order which can be made by a creditor, when the debtor who owes them money, is also owed money from a third party entity. Once the attachment of debts order has been served, the third party who owes money to the debtor will be ordered to pay the debt directly to the creditor instead. An attachment of debts order can also be made against a bank account that the debtor has savings in (but not against any Centrelink benefits or allowances which they may have).

More information about attachment of debts and monetary court orders can be found here.