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Business disputes may be prevented by clearly-written contracts

| Sep 18, 2014 | Business Contracts & Disputes |

Any business, whether in North Carolina or elsewhere, will run into disputes with current or former employees, other businesses, affiliates, and customers. There is no iron-clad way around it. Business disputes are a part of the normal dynamics of human relations.

The best preparation that a business can have to at least minimize such disruptions is a clearly-written agreement with the other person or business entity. A clear, concise and inclusive contract is the company’s best protection in the first place. The number of disputes that arise will be considerably lessened simply by having the parties duties, rights and responsibilities stated clearly in writing.

Such agreements do not rise and fall on the volume of “legalese” that the company’s legal counsel can insert. The modern trend is for plain and understandable language. If a company has the benefit of counsel in the drafting stage of such agreements, the parties can negotiate for the wording that each can understand and live with.

Dispute resolution clauses often appear in business agreements. They may consist of language that requires a dispute be resolved by way of arbitration through a national arbitration association. Such provisions may work a decided advantage or disadvantage to some parties to a contract. It’s best to have counsel to consult with in determining whether such a clause is acceptable.

In general, most business disputes in North Carolina and other states will be settled amicably by the parties through a process of pre-litigation negotiations. However, in the more serious matters that evade amicable resolution, and are not earmarked for arbitration, civil litigation in the court system will be the endgame. The process can be drawn out and convoluted. The company may be pressured and imposed upon to satisfy massive discovery requests, and for the appearance of busy officers to give their oral depositions. The good news, however, is that the great majority of these matters are settled peaceably at some time prior to the parties having to go to trial.

 

Source: Albuquerque Journal, “Courts settle business disputes; use clear contracts to avoid“, Stephen S. Hamilton, Sept. 10, 2014

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