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Thursday, February 21, 2013

Wine Industry Lawsuits: How to Avoid Them


No one expects to have to go to court when they start a business deal or venture, or when they plant a vineyard or purchase real estate, but in today’s world no industry is free from lawsuits, particularly not the wine industry. Disputes over grape purchase agreements (duration, termination, quality standards, etc.), vineyard development agreements (quality of vines, planting and maintenance, and sufficiency of site evaluation and preparation, etc.), wine storage agreements (condition of wine, losses, damage to wine, etc.), custom crush agreements (compensation, quality control, etc.), real property matters (title, ownership, boundaries, easements, etc.), and even employment relationships (statutory requirements, executive agreements, workplace safety, etc.) can rise to the level of a lawsuit involving the smallest or largest members of the wine community and costing from tens of thousands to hundreds of thousands of dollars. All too often, however, it is not until the fighting begins that the parties and their attorneys look back and see where the dispute could have been avoided or at least how the parties could have better protected themselves before the dispute arose.

Simple measures are usually the most effective. For example, many people don’t review their written agreements until a dispute arises, and then they often find that the paperwork does not read like they recalled it read, or they find that the agreement is ambiguous on a matter that was not an issue until circumstances changed. Instead of shelving your paperwork once it’s signed, there is tremendous value in periodically reviewing written agreements to confirm that they match your understanding of a deal, as well as to confirm that the agreement is being correctly followed. Such a review can, but need not, involve the assistance of counsel. At the very least, such reviews help keep everyone on track while they are still getting along, and when things are not on track, the parties can usually make mid-course corrections in the paperwork or their conduct (or both) without much debate or fanfare because there is no dispute pending. Once a dispute arises, however, such corrective measures are more difficult to achieve.

It is even more important to take such a proactive approach in cases that do not involve written agreements because differences in recollection often cloud the dispute resolution process once a legal battle has begun.

Likewise, where property issues are involved, it is better to find out about your state of title before you are in a dispute with a neighbor. Such early knowledge not only presents the opportunity to find a solution with your neighbor while everyone still gets along (or at least has not been antagonized by the existence of dispute), but it also allows you to get properly informed as to what you should or should not do to protect your property rights in the absence of a negotiated solution since many of the legal rules involved with property disputes are counter-intuitive to non attorneys.

In short, sometimes you need to look back to move forward in the safest way.

For more information or assistance on litigation matters, and how to prevent them, contact Paul Carey at pcarey@dpf-law.com

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