You opened your own business recently, and you feel ready to create your first contract with a client or employee. Do you know how to avoid contract disputes? Set yourself and your business up for success and smooth waters.
Account for all financial matters before starting a project
Before launching a project, get specific on your budget and which party bears responsibility for certain costs. For employees, clarify which financial responsibilities they bear, such as gas if they work outside of the office. For clients, look for areas in your contract that may lead to payment and cost disputes, implementing strategies for addressing and handling disasters before they strike.
Perform your due diligence
Before hiring an employee or doing business with a potential partner, run background checks and perform your due diligence. The primary goal with this tip is to verify the other party’s ability to sign your contract. You do not want to go into business with a person who gives a false identity or impression of her or his ability to sign a contract. If you do business with an individual using a fake ID, contacts you sign do not stand up in court.
Look to the future
Do not let the excitement of a new business relationship keep you from looking down the road of possibility. For instance, how do you and the other party wish to handle contract renewal? What if you or the other person cannot uphold your side of the agreement?
While you may not avoid every contract dispute, you may protect yourself. Take steps to keep disagreement at bay.