At some point, disputes are inevitable with employees, partners, vendors or other businesses. You can take certain measures to reduce the chances of disputes by including certain provisions in your contracts with them, so we recommend employing these three important tips to prevent contract disputes.
1. Make it official
The best, safest and easiest way to have enforceable terms in your contracts is to have your attorney draft them.
A contract means nothing unless it is legally enforceable. Ensure that your contract is legally binding by working with an attorney. A professional will ensure you do not have any legal holes in your document. Having an attorney draw up the agreement makes it more likely that all parties will carefully read the document, meaning there is less of a chance they will dispute it later.
2. Double-check your budget
One of the top reasons for business disputes involves payment issues. While it might seem obvious that you should account for all costs up-front, it’s easy to jump the gun on projects when you are eager to get them started.
It is common to overlook seemingly small costs that can grow quickly over time. For example, you want to make final agreements with vendors for a company event. Did you account for how your employees will reach the event? Will there be a shuttle? The cost of a shuttle, driver and gas can quickly add up. Wait to sign contracts until you understand all costs and how they will be managed.
3. Plan for the future
The contract should account for a number of future variables. Always consider “if” and “when.” What happens if one of the parties goes out of business? What happens when the contract expires? Don’t leave anything up to chance.
Ultimately, a legally binding, well-planned contract with simple language will be the most effective for preventing disputes. It is better to spend extra time and cost now to create a great contract than waste even more time and money litigating terms in court.