When you sign a contract with another party, whether it is an independent contractor providing a service or a vendor providing equipment, you expect them to follow through with their promises. Unfortunately, many businesses and individuals default on their contractual obligations.
You will likely have to deal with a breach-of-contract scenario at some point as a business owner. There are multiple ways that you can handle such a matter. Here are some of the options:
Settle the issue privately
In a perfect world, telling someone that they breached a contract would result in a prompt apology and a correction of the issue. Sometimes, that exact outcome is possible if you notify the party about their failure.
Gentle, informal communication can sometimes achieve success. Other times, a strongly-worded letter could push someone into compliance. If you can reach a mutually agreeable solution, you don’t have to take action about the breach of contract.
File a civil lawsuit
If the other party doesn’t communicate with you or refuses to address the problem, then your only choice may be to take them to court. A breach of contract lawsuit will mean that a judge reviews the contract and the situation and decides what to do from there. They might award damages, void the contract or push the other party to fulfill their obligations.
Agree to the alternative dispute resolution
Sometimes, filing a lawsuit will motivate the other party to work with you. They may suggest mediation or arbitration as a way to resolve the conflict peacefully. Going through either process could help you settle the issue, after which you can always dismiss the pending lawsuit.
Understanding the different ways that you can resolve a contract dispute can empower you to seek the best solutions.