Entering into a contract brings the risk of potential disputes down the road. When a contractual disagreement arises, you want to ensure you have properly protected and positioned yourself. This guide provides key strategies for shielding yourself when dealing with contract disputes.
Document Everything in Writing
A written record of all agreements, communications and transactions is imperative. Verbal contracts may be legally binding, but verbal agreements often devolve into “he said, she said” arguments with no definitive proof.
- Put all agreements, revisions, terminations, etc., in writing rather than relying on verbal approvals. Email or certified mail provides documentation. Certified Mail Labels provides a simple way to send important contract documents while having proof of mailing and delivery.
- Maintain thorough written communication records for everything related to the contract.
- Log and save all phone calls, meetings, and other verbal discussions in writing via summaries, memos, or emails.
Following this paper trail approach minimizes discrepancies and provides evidence if contract disputes reach litigation.
Anticipate Potential Issues
Think through anything that could go wrong or be disputed down the road and address it upfront in the contract language. Ambiguous, vague, or missing terms set the stage for misunderstandings and conflicts.
- Define roles, responsibilities, and expectations explicitly to prevent finger-pointing later on.
- Address deal breakers and no-go situations like non-compete clauses and liability limits.
- Set clear payment procedures and consequences for late payments.
- Allow contract cancellation only under specific conditions.
- Designate rules for settling disputes out of court through mediation or arbitration.
Covering as many potential dispute scenarios as possible in the contract gives you something definitive to fall back on.
Follow Protocol Precisely
Strictly adhering to all notification and response protocols defined in the contract works to your advantage. Failing to follow the agreed-upon dispute resolution process could result in you forfeiting certain rights or options.
- Send proper written notice within designated time frames for anything requiring notification, like contract changes, disputes, cancellations, etc.
- Respond to all notices and demands according to the timeline and conditions indicated in the contract.
- Only engage authorized representatives identified in the contract for formal communications and negotiations.
Abiding by the letter of the contract, even if the other party is not, puts you on solid legal footing.
Document Contract Performance
Throughout the contract term, keep detailed records that demonstrate you are fulfilling your contractual obligations and performance standards. This evidence is invaluable if the other party falsely accuses you of contract breach or non-compliance.
- Maintain data, reports, logs, and files that validate you are doing what you agreed to do per the contract.
- Get written sign off or confirmation when delivering key project milestones or deliverables.
- Take photos, videos, and screenshots to prove contract conditions are being met.
- Keep a paper trail of your efforts to resolve issues and disputes before litigation.
Providing proof of your contract compliance weakens any claims against you.
Consult an Attorney
If a contract dispute escalates beyond civil negotiation, consult an attorney experienced with contract law and litigation. They can review your documentation and contract language to build the strongest case while identifying any potential weaknesses. An attorney can also handle communication and filings if a lawsuit is filed.
By taking proactive steps like using certified mail to document exchanges, sticking firmly to contract protocols, and validating your own contract performance, you will be well prepared for any contract disputes that arise. With the upper hand, you can often reach an equitable settlement and avoid prolonged legal battles.
Veeramachineni Lalitha
I am Finance Content Writer. I write Personal Finance, banking, investment, and insurance related content for top clients including Kotak Mahindra Bank, Edelweiss, ICICI BANK and IDFC FIRST Bank. My experience details : Linkedin