Business agreements rely on contracts to define obligations and expectations. When one party of the contract fails to uphold their end of the bargain, that breach of the contract can trigger litigation. Vague and poorly worded contracts are harder to enforce.
Understand the most common contractual mistakes to protect the validity of your contracts.
Contract terms should be clear
When you draft a business contract, any terms that are important to the outcome must be clear and specific. For example, if you specify that a product must arrive by a certain date, but you fail to prohibit modifications to the product design, you will have no recourse if the product shows up altered but on time.
Contracts depend on specifics
Ambiguity of any kind in a business contract leaves room for misinterpretation, confusion and conflict. Review business contracts for definitions of vague terms, specifics about currencies and key details about the contract terms.
Contracts should specify what constitutes a breach
Avoid any misinterpretation or contest of a contract breach by including a section that defines what constitutes a breach. Address any potential failures or conflicts, including the length of time that either party can be in default of the contract before a breach applies and the contract becomes null and void.
The clearer your business contracts are, the less risk you face of misinterpretations, confusion and breach. These are some of the most important considerations to protect your contract clarity and enforceability for your business.
Having an experienced business attorney review or draft your important contracts BEFORE they are signed should help you avoid these issues.