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Home > Business Law > Declaratory Judgments

Declaratory Judgments

If you’re mired in a dispute with another business and fear that a lawsuit could arise—filed either by or against you—you may be seeking some certainty about the outcome. A declaratory judgment can be a useful tool that helps you clarify your legal rights in advance of a lawsuit or before you’ve suffered a financial loss. The experienced Chicago business litigators at Pluymert, MacDonald & Lee can help you decide if a declaratory judgment might help you gain an advantage in an Illinois legal dispute. Contact our seasoned attorneys for a consultation on your case.

What is a declaratory judgment?

A declaratory judgment is a court order that makes official your legal duties and rights, as well as the rights and duties of the other party. Declaratory judgments are enforceable like other court-issued judgments, but unlike a normal judgment, they can be obtained before a breach of a legal duty has occurred and without going through a full trial. Declaratory judgments are essentially a means of letting a court provide its perspective on a dispute between two parties before one of the parties reaches the point of filing a lawsuit against the other. Often, the dispute is between parties to a contract who have divergent opinions on what it means to perform their duties under the contract, or what would constitute a breach.

How is a declaratory judgment different from other court orders?

Declaratory judgments are unlike judgments obtained pursuant to a trial or other forms of immediate legal relief such as preliminary injunctions or temporary restraining orders. Declaratory judgments will not result in an order for one party to compensate the other, nor will they result in one party being held in contempt or otherwise subject to penalties if parties fail to act in a certain way. If one party does not perform in accordance with the declaratory judgment, the other will still need to file a lawsuit to obtain either money damages or performance. A declaratory judgment can, in some cases, ward off a trial by making the legal obligations of the parties clear. A declaratory judgment may also simplify the issues to be determined at trial by having a judge decide them in advance of a lawsuit.

When do parties seek declaratory judgments?

Illinois businesses often seek declaratory judgments when:

  • One party has indicated their intent to breach a contract
  • There is a threat of regulatory action by a government agency
  • There is a disagreement over insurance coverage of a given event
  • One party alleges an infringement of intellectual property rights

Experienced Chicago Business Litigators Ready to Help You with Your Business Dispute

To speak with a seasoned, professional, and effective Illinois business litigation attorney, contact the Chicagoland commercial litigators at Pluymert, MacDonald & Lee at 847-310-0025 (Hoffman Estates), or 847-298-5030 (Des Plaines).

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