Business contracts don’t always experience a flawless commitment between two parties. Oftentimes, conflict arises when there’s accusation of stepping outside the agreed upon terms outlined in a contract. When this happens, there is a pause to the progress of the business and the dispute must be addressed and settled. That’s when the courts and lawyers get involved.
Within the court of law, the argument is presented privately and before a judge to determine the rightful actions to take. Depending on the ruling, contract members may be subject to one of the three main types of solutions.
Here are the three main resolutions for contract disputes:
- Financial compensation for damages rendered – Seeking to recover financial damages from a breach of contract is the most common type of outcome sought in court. This includes various types of damages including: compensatory, punitive, nominal, and liquidated.
- Specific performance – Court appointed duties may be enforced following a contract dispute. This may result when damages are not a possible resolution.
- Restitution or cancellation – The non-breaching party member may have restitution to the contract. This motion would allow the non-guilty party to revert back to its pre-breach condition. A cancellation however nullifies the contract completely, rendering it void and no longer legally binding to any of the parties involved.
Businesses are always encouraged to have careful oversight when drafting and preparing a contract. Contracts may avoid dispute when they are carefully pre-screened for loopholes and mistakes. Lawsuits do not have to take your business or your vision down. There are many resources that guide business owners through the process and help mitigate the challenges they face along the way.