A breached contract feels like a fight, but litigation is rarely the first move. Most commercial disputes in Texas resolve before a petition is ever drafted, and the work between the breach and the courthouse steps determines how much the dispute ultimately costs. A Dallas business law attorney who handles commercial litigation usually spends more time on pre-suit strategy than on the lawsuit itself, because what happens in the first 60 days often decides the outcome.
Before paying a filing fee, work through the items below.
Confirm You Actually Have a Breach
Not every disappointment is a breach. Texas contract law requires four elements: a valid contract, performance or tendered performance by the plaintiff, breach by the defendant, and damages caused by the breach. A vendor who delivered late but cured before causing loss may not have committed an actionable breach. A counterparty who departed from the contract because of your own prior failure may have a defense in hand before suit is filed.
Read the agreement against the actual facts. Identify which provision was breached, what performance was missed, and what concrete damage resulted. If any of those three is fuzzy, the case is fuzzy.
The Demand Letter
A good demand letter does three things: it puts the other side on formal notice of the breach, it positions you for attorney’s fees, and it opens a settlement conversation while preserving your legal position. A bad one creates evidence against you.
The letter should identify the contract and parties, quote the specific provision breached, lay out the facts of the breach, quantify damages with backup if available, demand cure or payment by a specific date (10 to 30 days out), and reserve all rights.
What to leave out matters as much: emotional language, inflated damage numbers you cannot support, legal theories you have not vetted, and anything you would not want a jury to see later.
Send by a method that creates proof of delivery: certified mail, return receipt requested, with email as backup.
Statutory Notice You Cannot Skip
Texas requires pre-suit notice in several contexts, and missing it can defeat parts of an otherwise good claim.
Section 38.001 of the Texas Civil Practice and Remedies Code governs attorney’s fees in breach of contract cases, and Section 38.002 requires the claimant to present the claim at least 30 days before filing. The defendant has those 30 days to pay before fees become recoverable. Skipping presentment costs you the attorney’s fees award, which often exceeds the damages.
Texas Deceptive Trade Practices Act claims (Business and Commerce Code § 17.505) require a 60-day pre-suit notice giving the defendant the chance to inspect, offer to settle, and propose a cure. Filing without it forces a 60-day abatement once raised.
The Residential Construction Liability Act (Texas Property Code Chapter 27) imposes written notice and a right to inspect for construction defect claims. Insurance claims may trigger the Texas Insurance Code Chapter 542 prompt-payment provisions, which carry their own notice and deadline rules.
Section 38.002 presentment catches commercial litigants most often. Build it into every contract demand letter regardless of whether suit looks likely.
Mediation Before You File
Most Dallas County and Collin County judges send commercial cases to mediation eventually. Doing it voluntarily before filing saves the fees that accrue while a lawsuit sits on the docket.
Pre-suit mediation costs each side roughly $2,000 to $6,000 for a one-day session, plus a few thousand in preparation. That sounds like real money until compared to litigation through trial, which routinely runs six figures and often higher.
Mediation works best when the breach is real and damages are quantifiable, when both sides have something to lose from full litigation, and when confidentiality favors settlement. It tends to fail when one side wants public vindication, when the breach is denied entirely, when a counterclaim of similar size is in play, or when the defendant cannot or will not pay. Even unsuccessful mediation produces useful information about the other side’s view of the case.
Strategic Questions Before Filing
Litigation is a budgeting decision, not just a legal one. Run through the following before authorizing a petition.
Statute of limitations. Most Texas contract claims must be filed within four years (Civil Practice and Remedies Code § 16.051). Sale-of-goods claims under UCC Article 2 have shorter periods. A tolling agreement can buy negotiating room when the deadline is approaching.
Collectibility. A judgment against an insolvent defendant is a piece of paper. Run basic asset due diligence before incurring the cost of suit.
Forum. Most contracts contain venue, arbitration, or jury waiver provisions. Check before drafting.
Counterclaim exposure. Filing invites the other side to file its own claims. Read your own performance against the contract honestly before going to court.
Cost. Through dispositive motions, a Dallas commercial dispute typically runs $50,000 to $150,000 per side. Through trial, $250,000 and up. Expected recovery should justify the budget.
Reputational impact. Some industries are small. A lawsuit can close doors that a settlement would not.
When Filing Is the Right Call
Sometimes it is. A counterparty refusing to pay a clear, large invoice. A partner withholding access to company records. A competitor using stolen confidential information. Those cases often need the court’s coercive power early, and waiting costs more than litigating.
For deeper reading, the Texas Civil Practice and Remedies Code is published at statutes.capitol.texas.gov, and the State Bar of Texas Litigation Section maintains practice materials on commercial dispute resolution. If you are weighing whether to send a demand letter, attend mediation, or file suit, a short consultation with a Dallas business law attorney before any of those steps usually pays for itself in saved fees and better positioning.
The decision to file or not file is one of the highest-leverage calls a business owner makes in a contract dispute. Make it with the right facts in hand and the pre-suit groundwork already done.
