Business contracts are a crucial part of any business, which means there is always the possibility of a breach of contract. When a breach of a business contract occurs, it is important to know the proper steps to take. This prevents wastage of time and reduces the risk of missing the statute of limitations.
A good business contract entails what happens in case there is a breach. This section is crucial to include in the document, no matter how close the parties are. An experienced business contract attorney can guide you through every step of the process. talk to a lawyer today.
Steps to take if your business contract was violated
- Talk to the other party.
Sometimes the breach of a business contract is an honest mistake, and the other party may not even realize they have committed a breach. Instead of directly going to court, it helps to sit with the other parties and discuss the issue. For example, if the breach is regarding a missed payment, you may be able to agree on another arrangement.
- Understand your damages.
Every business contract breach causes damage. Some damage may be insignificant and can be ignored, but some can devastate your organization. Often, even if the breach was an honest mistake, you may want to recover your damages. If you file a claim, make sure you understand your damages.
- Attempt mediation or arbitration.
If the contract breach has resulted in significant damage, you can arrive at a conclusion and recover your losses without involving the court. You may be able to reach a settlement agreement with the other party using methods like mediation and arbitration. When handled well, ADR methods like mediation and arbitration can solve a problem more quickly than legal proceedings.
- Know your statute of limitations.
When you realize there has been a breach of contract, you must decide what your next step will be. This is because there are specific statutes of limitations, and you do not have a lifetime to file a claim. If you miss the deadline, you won’t be able to recover your damages, no matter how much evidence your side has.
- Determine whether going to court is necessary.
After trying methods like mediation and arbitration and failing, you need to decide if going to court is worth it and necessary. Taking your case to court means assessing if you have enough evidence, being within the statute of limitations, and paying several costs. You must determine if going through all that trouble is worth the damage.