Although there’s something romantic and honorable about a handshake to solidify a business deal, in the real world, you want to protect yourself by having a comprehensive contract drawn up by legal experts. Contract disputes are amongst the most common problems in business. A hand-shake is a good start, but having a contract will ensure that everyone enters into the business agreement with a clear understanding of the terms, expectations, and consequences.
Common contract disputes
Several contract disputes can arise, like unclear terms and expectations, one-sided contracts, or parties feeling coerced into signing. A binding legal business contract should benefit and protect all parties, and all parties should be involved in creating the terms, conditions, and expectations of said contract.
Ill-defined business contract
Having a loosely defined business contract can lead to a contract dispute. When both parties don’t agree on specific terms or conditions mentioned in the contract, it is usually because these terms were not clearly defined and understood from the beginning. Everyone should know exactly what is expected of them, making sure that there are no errors or mistakes that could later be used to dispute the contract in case something goes awry.
A clear set of expectations will save you many potential contract disputes, but a well-defined business contract will also include a section on what will happen in case of unexpected events that delay, set-back, or prevent a party from completing their end of the agreement. Every business contract should have a contingency plan in case of an emergency or natural disaster.
All parties involved in the business agreement should have input into the contract that is being signed. The contract should protect and benefit everyone involved. It should be a mutually agreed-upon set of meticulously defined expectations, as well as the consequences for failing to comply or fulfill the agreed upon terms and conditions.
Coercion or fraud
When a contract is one-sided, a common claim in a contract dispute is that one party was forced or coerced into signing. If one party feels that they were not given proper input, or were being unfairly pushed into a contract that does not protect or benefit them, they will have reasonable grounds to dispute the contract.
Drafting and reviewing business contracts
These sorts of disputes can often happen if you do not seek the legal advice of a professional when preparing your business contract. Sandstrum Law can help in the drafting and reviewing of business contracts to make sure they are properly defined and executed to avoid future contract disputes.