As a business owner, you frequently enter into business contracts with an array of people and other businesses.
Any time that contract gets breached, it means a loss of some kind. After verifying the other party has broken the contract, take action quickly.
1. Discuss the breach
Once discovered, have a discussion with the other party. In some instances, a vendor or contractor has misinterpreted the contract or simply made an honest error. Oftentimes, approaching the matter face to face leads to a suitable solution. If it does not, you have other courses to take.
2. Weigh your resolution options
While your situation may require filing a lawsuit, arbitration or mediation offer out-of-court opportunities. During mediation, a mediator works with you and the other party to work through and resolve the dispute. Arbitration involves working with a person or panel, who ultimately rules on the situation.
3. Calculate your damages
Whichever solution you decide on, you need an accurate account of your losses. In the majority of cases, the damages come in a monetary form, such as not receiving payments or incurring additional costs.
4. Know your legal limitations
If you determine taking legal action serves as the best option, you have time limits to consider. Pennsylvania has a four-year statute of limitations regarding breach of contract claims. While that may seem like you have plenty of time, filing a claim comes with many complexities that cannot happen overnight.
Keeping your business thriving means having the confidence that business associates and others will adhere to contracts. If a contract gets broken, you have the right to recoup your losses.