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Whether you are a small startup business or a large corporation, disputes over the terms of contracts will happen. These disagreements can be stressful, time-consuming and costly. In the worst case scenario, they could jeopardise the future of your business. Therefore, it is sensible to educate yourself on the ways to minimise the impact of these disputes or avoid them altogether. You are already on the right track by researching and reading this article, so let’s get started.
All contracts should be clear. When you are creating contracts with other business, employees or partners, ensure that the agreement is free of ambiguous wording. The aim is that each party understands exactly what the intention of the contract is. You may wish to use templates for standard contracts if you are unsure about the wording to use. However, do make sure you are using documents from reputable sources.
All parties must read the contract before signing. Most people will only skim over a contract before signing on the dotted line. This is not sensible. Whenever you are about to enter into an agreement with another party or parties, ensure that you read and understand all the terms and conditions. And when you are asking parties to enter into an agreement with you, encourage them, as far as you can, to do the same.
Raise any concerns before signing. If you have any concerns about a contract, no matter how small you may think they are, discuss them with the other party or parties before signing. Imagine you were right to be concerned about that particular condition of the agreement. However, because you didn’t vocalise these issues, you subsequently find yourself in a difficult situation. Sort out as many areas of contention before you seal the deal.
When a dispute does arise, if the situation allows, begin by entering into a negotiation with the other parties. There are many courses and resources you can read in order to improve your business negotiation skills. You can try doing this alone at first, but you may wish to contact an experienced mediator if your efforts are unsuccessful. Better yet, look for negotiation training courses. For instance, Scotwork’s proven negotiation training programmes might help.
It is a good idea to establish an on-going relationship with a good law firm. You are unlikely to be experienced in business law, but specialists firms such as John Samaan are, and they can help your company with many of these areas. Business lawyers can assist with drafting clearly worded contracts that reduce the probability of disputes. And if a disagreement does arise, they can provide you with legal advice on how to deal with the situation.
Contracts are an important part of any business. It is essential that all business owners understand that disputes are inevitable. In most cases, they can be resolved with negotiation, but in others, where big errors have been made, stronger action should be taken. This post is only intended to be a brief introduction to contract disputes. It is highly recommended that you continue to educate yourself in all elements of business contracts.