One key characteristic of successful businesses is their owners’ ability to plan, especially when it pertains to disputes. Though often unpleasant, business/contract disputes are an unavoidable reality in the business world. Disagreements can occur between business owners, partners, their representatives, employees, vendors and other parties that could bring about complex challenges.
Disputes can lead to contract breaches and quickly escalate into matters that require legal intervention, which can become quite costly for business owners. Not all types of disputes or contract breaches require litigation. Below are actions business owners can take to protect their organizations from the consequences of disputes.
Get every business arrangement or agreement in writing. Traditionally, a handshake between two professionals was enough to signify a contract, but that is not enough to enforce contracts today. Many issues can impede the enforceability of verbal contracts. That is one reason why the majority of successful business dealings are on paper. Documentation makes it easier to enforce contractual agreements even in the event of disputes.
When drafting business contracts, anticipate potential sources of disagreements and outline the steps to resolve them. In the event of future disputes, business owners and other affiliated parties can refer to the agreement to manage their disputes properly.
Business disputes often stem from confusion or communication issues. Business owners who use contracts/policies to establish roles, expectations and all contractual obligations generally find it easier to resolve disagreements early-on to avoid potential litigation issues.