In business, many exchanges are covered by a contract. While your lawyer encourages you to read every contract you sign, and to send the contracts to them for review, the reality is that there are plenty of contracts that are never read. Or they were read and negotiated years ago and the on-going relationship has run into issues or changed as the parties have engaged in business. So how you do settle a contract dispute if it can’t be easily resolved by talking?
Review the Contract
A well-drafted contract should take into account different situations that may arise in the future, so your contract may already address your concern. For example, if the work you are performing has slowly creeped out of the original scope, your contract hopefully has a clear scope statement and a way to handle out-of-scope work such as hourly or piecemeal billing. The first step in facing a contract dispute is to review the contract to see if it provides you a roadmap on how to proceed.
Once you see what the contract says, you can then open a discussion with the other party. They may want to re-negotiate the contract or handle matters differently, and that’s ok. Just make sure you get the changed agreement in writing as well. For significant changes, you may want to get an attorney involved who can help anticipate future issues.
Look into Dispute Resolution
If the issue is not already addressed in the contract, it’s time to look into dispute resolution options. Your contract should have a section that outlines how disputes between the parties are addressed. This should state that disputes are either handled in court or through arbitration. Some contracts even go so far as to outline how arbitrators are picked and what rules of arbitration will govern any disputes. For contracts that use the courts for dispute resolution, they should state the venue and the state laws that will govern the contract.
With this information, you can then talk to a business litigation attorney who can review the situation for you and discuss the pros and cons of taking it to court. Often, simply starting the litigation is sufficient to get the information needed to settle the issue. In other instances, you’ll be taking the argument all the way to court.
The Battle of the Forms
Another common problem is known as the battle of the forms when companies are sending purchase orders or other communications back and forth that have associated contract language. A binding contract must include a “meeting of the minds” where both sides agree to the same terms. So what happens to these documents where the terms are printed on the back or side? It depends on what the transaction is about (goods or services) and the terms used on the forms and whether they comply with state law. Terms that match in both versions tend to apply whereas terms that cancel each other out tend to do just that.
If you’re facing a business lawsuit, reach out to the experienced team of litigators at the Dunn Law Firm. We understand business litigation and contract law and can help you understand your case and position and the steps that your case will go through on the way to resolution. To learn more, reach out to the Dunn Law Firm by calling (435) 628-5405 and set up a free consultation today.