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3 Possible Ways the Courts Can Resolve a Business Contract Dispute

Burgoyne Law Offices Feb. 24, 2021

People who run businesses are often skilled negotiators — but they can still find themselves in scenarios where they can’t resolve their own issues.

Maybe you have run into a conflict with a supplier or a company that is supposed to remodel your offices. Neither of you will compromise, and the issue has started to affect your business. You need to take them to court to resolve the matter.

What are the ways that the courts might resolve a contract dispute between two companies?

The Courts Might Invalidate the Contract

Depending on the nature of the dispute and the language of the contract, the courts may find that the contract is no longer legally valid or binding. Sometimes, the courts may find that the language in the contract itself is defective. If so, the courts can throw out the contract, absolving you of any obligations to the other party.

The Courts Might Order Specific Performance

Did a contractor take your deposit and then not do the work on your building? Have you made payments to aA supplier who has not delivered the raw materials you need?

Instead of just getting rid of the contract, you may want the courts to enforce it. Ordering specific performance is a way for the courts to uphold the contract and have one party fulfill their obligation to the other.

The Court Might Penalize the Other Party for Their Breach of Contract

Perhaps you don’t need to undo the contract because its effective period has already ended. Maybe you no longer want to do business with the other party because you can’t trust them, so specific performance isn’t an ideal solution.

The courts can order financial compensation for a party wronged by a breach of contract. You can show the verifiable losses your company had to absorb because of the breach, and the courts can then factor that into their ruling.

There may be other options before you turn to litigation for your business. Talk to an experienced advocate about your legal options.