Home Blog Contract Dispute: When They Happen & Resolution

Contract Dispute: When They Happen & Resolution

This page explains what a contract dispute is, its warning signs and legal options, and how a lawyer from ContractsCounsel can help you.

Jump to Section

What Are Contract Disputes?

Contract disputes occur when parties don’t agree on terms or obligations in an agreement. They can result in stressful court dates, expensive litigation, and/or damaged working relationships that impact business operations.

In this article, we outline the important things to know about contract disputes, such as why they happen, how to predict them, and how to resolve them so that you don’t have to be embroiled in a lengthy dispute or one that goes to court.

Why Do Contract Disputes Happen?

Contract disputes can happen for several reasons. Some of the most common reasons include:

Failed Obligations

One party might not fulfill their responsibilities outlined in the contract. There could be failed services or payments, or deliverables that don’t meet company standards.

Scope Creep is a common type of contract dispute, which is when there are disagreements about work scope. One party might think specific tasks were included in the contract, while the other party doesn’t.

Confusing Contract Terms

If the contract contains confusing or vague terms that aren’t easy to understand, it can cause disputes between parties. This is why getting your contract drafted by a vetted lawyer is so crucial for contract clarity.

External Changes

Sometimes, disputes can arise from events out of the parties’ control. This could include events such as supply chain problems or unexpected force majeure events, such as natural disasters.

Misrepresentation or Fraud

If one party hides certain facts or refuses to disclose information, this could result in disagreements that cause the other party to want to end the contract.

Contract Termination

If one party wishes to end the contract early, this could potentially cause problems with the other who might not want to terminate it.

Changes

Should there be business or service changes that were agreed on verbally but not put on paper, disputes could arise. There could be misunderstandings between parties about what was agreed on.

What are Warning Signs of Impending Dispute?

It’s common for there to be some warning signs that contract disputes are brewing. Being aware of these signs can help you to resolve the issues and preserve your working relationships. Some warning signs include:

  • Increased tensions between parties
  • Reluctance to follow schedules
  • Delayed communications
  • Changes in work quality
  • Changes in behavior

Addressing any issues or concerns with the other party as soon as you notice red flags could help you to solve the problems internally. This is especially because many disputes arise from misunderstandings.

How Should You Handle a Dispute?

Since disputes can cause legal costs, financial losses, and business operational disruptions, you want to ensure you handle them in the right way.

Refer to the Contract

The first thing you should do is refer back to the original agreement so you can check what terms you and the other party have agreed to. This will help you identify what clauses can be negotiated or contested. You’ll also view the contract’s conflict resolution clauses. The agreement might state specific steps to take to resolve disputes that you’ll have to follow.

Keep a Record of all Communications

It’s useful to keep a detailed record of communication from the early stages of a dispute. It can prevent misrepresentation while clarifying responsibilities.

Be Respectful

Even if you disagree, listen to each other’s concerns and views, as it can prevent escalating tensions and enable you to resolve the dispute out of court.

Stay Informed

As they say, “Knowledge is power.” You should gather all important documents, such as the original contract, and know your rights, obligations, and what dispute terms are included in the agreement, as outlined earlier. This information helps you to better state your case.

Be Open to Compromise

Try to find some middle ground with the other party. Being flexible can help you better navigate the process and preserve working relationships.

What Legal Options Are There for Contract Disputes?

There are four main legal options for resolving contact disputes.

Negotiation

This entails both parties meeting to discuss the situation and problem solve. It’s cost-effective and prevents escalation, which is why it’s a preferred method of resolving disputes. It also enables both parties to have more control as they make their own decisions for how to move forward.

Mediation

Mediation involves having a mediator present to help the parties navigate the dispute and reach a resolution. A mediator creates a safe space for both parties to express their views and listen to each other. It prevents escalating tensions and can be useful if the parties aren’t communicating constructively.

Arbitration

Instead of a third-party mediator, arbitration involves an arbitrator. Both parties will submit their case to an arbitrator who listens, examines the presented evidence, and makes a final decision, which is usually legally binding.

Litigation

During litigation, the dispute is taken to court. It can be costlier than the other dispute-resolution processes, but it’s a formal process with clear rules enforced by the court.

How Can a Lawyer Help?

A lack of legal expertise can cause you to struggle to navigate contract disputes, especially if they’re hostile. Hiring a lawyer can help you to review the contract and explain any vague or confusing terms, or loopholes you might have missed. This will help you to stand your ground and protect your interests. Lawyers will also guide you through negotiations or settlement offers.

How Can You Prevent Contract Disputes?

When drafting an agreement, you can ensure it’s legal, fair, and clear so that you prevent misunderstandings or disputes in the future. The contract should include:

  • Clear, simple language. This makes it easy for all parties to understand. Avoid any vague or confusing terminology.
  • Review the contract with all parties. Sit down and read through the contract together so that you all understand your rights and obligations.
  • Set realistic expectations. Ensure the contract contains clear, achievable expectations for deliverables and deadlines.
  • Legal review. Getting a lawyer to review the agreement for any red flags or inconsistencies ensures it’s legal, fair, and protects all parties’ interests.

Do you need help with contract disputes?

Post your request for free on ContractsCounsel, an online legal marketplace where you can connect with vetted contract lawyers to draft and review your contracts.


ContractsCounsel is not a law firm, and this post should not be considered and does not contain legal advice. To ensure the information and advice in this post are correct, sufficient, and appropriate for your situation, please consult a licensed attorney. Also, using or accessing ContractsCounsel's site does not create an attorney-client relationship between you and ContractsCounsel.


Need help with a dispute

Create a free project posting
Clients Rate Lawyers 4.9 Stars
based on 22,830 reviews

Meet some of our Lawyers

Anita P. on ContractsCounsel
View Anita
5.0 (3)
Member Since:
August 25, 2023

Anita P.

Estate Planning Attorney
Free Consultation
4000 Legato Rd, Suite 1100, Fairfax, VA 22033
9 Yrs Experience
Licensed in DC, VA
American University Washington College of Law

I specialize in assisting families and individuals with their end-of-life and incapacity planning needs, utilizing Wills, Trusts, and a range of other services.

Recent  ContractsCounsel Client  Review:
5.0

"Anita was amazing. I never dreamed we'd be able to find an attorney as responsive and efficient as she was. She answered every question quickly and clearly. All the stars!"

Jonathan M. on ContractsCounsel
View Jonathan
5.0 (1)
Member Since:
January 19, 2023

Jonathan M.

Attorney
Free Consultation
Charlotte, NC
16 Yrs Experience
Licensed in NC, SC, VA
Charlotte School of Law

Owner and operator of Meek Law Firm, PC. Meek Law Firm provides comprehensive business law representation, precise and informed representation for real estate transactions in the commercial and residential markets of North and South Carolina and efficient succession and estate planning for business owners and individuals.

Recent  ContractsCounsel Client  Review:
5.0

"He educated and did a through job with making sure that all the bases were covered in the contract reviewed. I do hope to work with again."

David A. on ContractsCounsel
View David
5.0 (1)
Member Since:
January 23, 2023

David A.

Family Lawyer
Free Consultation
Florida
44 Yrs Experience
Licensed in FL
University of Florida

Graduated UF Law 1977. 40 years experience in Family Law/Divorce and Prenuptial Agreements. Rated "AV Preeminent" By Martindale Hubble, the oldest lawyer rating firm in the USA. Top 5% of attorneys in Florida as reviewed by Judges and other Lawyers (not client reviews). Personal prompt service and easy to contact--available 24/7. Good negotiator and very personable. My clients are my priority.

Recent  ContractsCounsel Client  Review:
5.0

"David was very helpful, patient, and responsive on this project. He cares about his clients and works to build a relationship and address your needs. I would absolutely recommend David."

Charles K. on ContractsCounsel
View Charles
5.0 (1)
Member Since:
January 23, 2023

Charles K.

Attorney
Free Consultation
New York, NY USA
43 Yrs Experience
Licensed in NY
University of Illinois Chicago School of Law (John Marshall)

~ Charles Kramer - Technology, Contracts and Intellectual Property Attorney ~ www.linkedin.com/in/charleskramer I am a New York corporate and technology attorney. My experience includes: - representing high-tech companies (including software, military, manufacturing and computer game companies) in connection with negotiating and drafting (1) toolkit, enterprise, Saas, PaaS and other complex agreements and licenses with companies around the world; (2) joint-venture, sales, publishing and distribution agreements; and (3) general corporate agreements. - 5 years as General Counsel of a software company (and many more years representing it as outside counsel); - 3 years as an associate in the Wall Street law firm of Lord, Day & Lord (then the oldest law firm in New York City practicing under the same name); and - speaking at conferences on legal issues including at the annual Game Developers Conference and Miller Freeman's Digital Video Conference. I am comfortable working in areas where the technology -- and the related law -- are new. My recent work includes working as a contract attorney (extended on a month-by-month basis) as American counsel for a publicly traded Swiss industrial corporation with responsibility for drafting form contracts for its planned "industrial internet of things" digital services. Accordingly I am comfortable working in a corporate environment using modern collaboration tools. I also have experience as an actor. https://www.imdb.me/Cholly.Kramer Charles Kramer (917) 512-2721 (voice, voicemail, text)

Recent  ContractsCounsel Client  Review:
5.0

"Charles was very informative and provided the best price for the work. Thanks again!"

Thomas G. on ContractsCounsel
View Thomas
5.0 (2)
Member Since:
January 27, 2023

Thomas G.

Real Estate Attorney
Free Consultation
Chevy Chase, MD
24 Yrs Experience
Licensed in DC, MD
University of Maryland School of Law

https://www.tgravelylaw.com/

Recent  ContractsCounsel Client  Review:
5.0

"Thomas was great to work with. He was easy to communicate with and helped ensure I got a fair contract for my commercial lease. I highly recommend Thomas to anyone."

Karen S. on ContractsCounsel
View Karen
4.8 (36)
Member Since:
January 31, 2023

Karen S.

Attorney
Free Consultation
Atlanta, GA
15 Yrs Experience
Licensed in GA
Georgia State University

I'm an attorney available to help individuals and small businesses in Georgia with initial business set-up, required filings, tax strategies, etc. I'm also available to draft, review, and negotiate contracts of many types, both personal and professional. I can draft and file real estate quit claims as well. My legal and business experience and expertise includes small business startups, information technology, technology innovation, real estate transactions, taxes, intellectual property, electrical engineering, the business of video game development, business requirements definition, technology consulting, technology companies, liability waivers and reduction strategies, and the electric utility industry. I work part-time for a local law firm and part-time in my solo practice. I'm also an adjunct professor teaching business law. In addition, I'm part owner, legal counsel to, and a board member of a virtual reality video game development company. I am a member of the Georgia Bar Association. Please reach out if you need attorney, documentation or consulting help in any of those areas!

Recent  ContractsCounsel Client  Review:
5.0

"Karen is amazing!! She is so approachable and gives great, practical guidance."

David T. on ContractsCounsel
View David
Member Since:
June 15, 2023

David T.

owner
Free Consultation
Ann Arbor
32 Yrs Experience
Licensed in MI
THOMAS M. COOLEY LAW SCHOOL

David Trentadue has been practicing law since 1994. He received his Bachelors’ Degrees in History and Political Science from the University of New Orleans and his Juris Doctor, cum laude, from the Thomas M. Cooley Law School. Currently in private practice, his areas of concentration include Estate Planning, Probate and Trust Administration, Real Estate, Business Formations and Corporate Governance. He is licensed in all state and federal courts in Michigan. He is also a Licensed Title Examiner

Joseph M. on ContractsCounsel
View Joseph
Member Since:
January 23, 2023

Joseph M.

Attorney
Free Consultation
Boston, MA
5 Yrs Experience
Licensed in MA
Massachusetts School of Law

Joe provides premium legal services to both individuals and businesses throughout the Commonwealth. Experience litigating civil and criminal matters, as well as drafting/negotiation transactional issues involving contracts, real estate, business formation, estate planning and more. Prior to entering private law practice, Joe worked for two decades in financial industry including regulatory and compliance for both national and regional banks and investment firms.

Judi P. on ContractsCounsel
View Judi
Member Since:
January 26, 2023

Judi P.

Attorney
Free Consultation
New Mexico
6 Yrs Experience
Licensed in NM
Arizona Summit Law School

Driven attorney with a knack for alternative dispute resolution, real estate, corporate law, immigration, and basic estate planning, with superb people skills and high emotional intelligence, and for working smart and efficiently, as well as time and financial management skills to deliver excellent legal work and solutions to legal issues. Seasoned with 20+ years of law firm and legal experience (real estate/corporate).

Brittany T. on ContractsCounsel
View Brittany
Member Since:
January 26, 2023

Brittany T.

Attorney
Free Consultation
Georgia
12 Yrs Experience
Licensed in GA
Florida Coastal Law School

Brittany is an experienced attorney specializing in transactional and complex contract matters including but not limited to SaaS development and product implementation, technology/data agreements, licensing, and compliance. She has over 7 years of experience providing strategic legal advice to individuals and business clients of all sizes, from start-ups to large corporations. Brittany has a strong understanding of the legal issues related to technology and software and is well-versed in drafting and negotiating contracts ranging from software licenses to data sharing agreements. She is a highly-skilled negotiator and is adept at finding creative solutions to challenging legal issues.

Find the best lawyer for your project

Browse Lawyers Now

Quick, user friendly and one of the better ways I've come across to get ahold of lawyers willing to take new clients.

View Trustpilot Review

Need help with a dispute

Create a free project posting
Clients Rate Lawyers 4.9 Stars
based on 22,830 reviews
CONTRACT LAWYERS BY TOP CITIES
See All Litigation Lawyers
CONTRACT DISPUTE LAWYERS BY CITY
See All Contract Dispute Lawyers

Contracts Counsel was incredibly helpful and easy to use. I submitted a project for a lawyer's help within a day I had received over 6 proposals from qualified lawyers. I submitted a bid that works best for my business and we went forward with the project.

View Trustpilot Review

I never knew how difficult it was to obtain representation or a lawyer, and ContractsCounsel was EXACTLY the type of service I was hoping for when I was in a pinch. Working with their service was efficient, effective and made me feel in control. Thank you so much and should I ever need attorney services down the road, I'll certainly be a repeat customer.

View Trustpilot Review

I got 5 bids within 24h of posting my project. I choose the person who provided the most detailed and relevant intro letter, highlighting their experience relevant to my project. I am very satisfied with the outcome and quality of the two agreements that were produced, they actually far exceed my expectations.

View Trustpilot Review

Need help with a dispute

Create a free project posting
Clients Rate Lawyers 4.9 Stars
based on 22,830 reviews

Want to speak to someone?

Get in touch below and we will schedule a time to connect!

Request a call

Find lawyers and attorneys by city