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Company accused of diverting funds away from classroom needs

Ohio businesses who regularly make contractual agreements with other entities know that careful development of these agreement is essential. The exact verbiage in a contract can make a big difference down the road if a conflict between the two parties ever ensues.

A current situation involving a charter high school in the northeastern part of the state provides an example of one of the many types of conflicts that can arise where the terms of the contract may be relied upon. Since 2012, the charter school has retained the Cambridge Education Group to act as the management team for the school. The original contract was set to last for a period of five years but the school recently terminated the agreement.

The school alleges that the private, for-profit management company diverted money that should have benefitted students to companies it is affiliated with for its own benefit. On these grounds, the school has cancelled the agreement early. The management company, on the other hand, alleges that all of their decisions and purchases were appropriate and in turn has accused the school of breach of contract. A formal lawsuit has been filed by the management company against the school.

Entities involved in contract negotiations or conflicts may find it helpful to talk to an attorney with experience in business litigation. This can give people the ability to understand their options in pursuing compenation or in defending their actions.

Source: Akron Beacon Journal, "Charter school faces lawsuit after firing Akron-area management company," Doug Livingston, Nov. 18, 2016

 

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