A good contract is essential to running a solid business. With a good contract, you protect your company’s rights and assets. You capture a deal that both parties are happy with and hopefully will not see any problems in the future.
A bad contract, on the other hand, often results in messy disputes. Even if you leave negotiations feeling good about your contract, how do you know that you have a solid contract? Is it possible that you ruined the contract for the future? Forbes has tips to identify when a contract dispute may be in your future.
You ignored the law
It is not uncommon to be ignorant of some laws, particularly with the complexity of business law. This does not excuse being ignorant on paper, however. It does not matter how precise your contract is, if you do not follow the law, then the contract is worthless.
You stayed one-sided
It might be tempting to try to get the best deal possible for yourself. To be selfish, however, and one-sided, people will eventually forego doing business with you. Courts may even find that one-sided agreements are unconscionable and will free the other side from his or her responsibilities to you.
You don’t update the contract
Every contract, particularly if it is a long-lasting contract, needs regular updating. Laws change and you need to have a contract that reflects the current law. Some contracts do not need updating as quickly as others. For instance, real estate contracts may need very rare updates, whereas contracts that include taxes may need updating often.