Businesses of all sizes face numerous challenges daily because of the different relationships that exist internally and externally. When you own a business, you must deal with all kinds of personalities: demanding clients, employees, vendors and even financial institutions. You might not always agree with each other. At its core, a commercial dispute is when a disagreement or conflict arises between two or more parties in a business relationship.
Commercial disputes happen because of mismanagement, misunderstandings and the failure to perform contract terms and conditions. They can disrupt operations, drain resources and damage your reputation. Owning a business inherently brings with it legal risks, including the potential for commercial disputes that could lead to lawsuits and claims against you or your company.
How can you protect your business from commercial disputes?
In the bustling heart of commerce that is New York, business owners can protect themselves from legal claims through contracts. A contract governs your business relationships by outlining every party’s responsibility to the other and the obligations they must fulfill. More importantly, it can include provisions addressing how you will address disputes if they ever arise.
A contract is a legally binding and enforceable mutual agreement, meaning all parties involved enter into the contract voluntarily. They promise to fulfill their obligations to the contract, and failure to do so is a breach of contract.
What happens when one party violates the terms of a contract?
A contract allows you to write down your expectations from each other and gives you the mutual right to remedy when any party breaches the terms and conditions. You can hold the breaching party accountable through private negotiations or commercial litigation. The other party can also take legal action if you violate the contract terms. Therefore, you must always review your contract thoroughly before signing it and revise it when necessary.
