These red flags can lead to litigation

On Behalf of | Dec 22, 2022 | Firm News

Binding contracts are the lifeblood of every viable business. Proper agreements can set the parameters of a strong business relationship with a vendor, employee and customer. Contracts not strategically drafted to reflect the deal’s conditions can harm a business, cracking its’ foundation. Fixing those cracks can mean legal action, including civil litigation.

It is understood that everyone needs to read a contract before signing it. Still, it is also essential to negotiate a fair and equitable deal that helps businesses and their partners flourish. Negotiation can also help uncover red flags that lead to future disputes and litigation.

Common signs of future disputes

Bad or unfair contracts put one or both companies at risk, perhaps leading to a breach of contract lawsuit or other legal action. These are some common examples:

  • The other party is unwilling to compromise or negotiate a fair deal.
  • The contract has auto-renewals, predetermined price hikes or questionable terms.
  • The contract’s terms are too good to be true.
  • The contract’s details are overly complicated or nonsensical.

Is it time to reevaluate?

Perhaps one of the above scenarios sounds familiar. Further investigation may also reveal that the company has an uncommonly high rate of contract disputes and a track record of litigation. Those who encounter these signs may preemptively contact an attorney who handles civil litigation to discuss potential legal exposure and how to address it.