A few common contract disputes include breach of contract, ambiguity of terms, and payment and performance issues. Resolving these issues can include using clear and concise language to explicitly explain the terms and conditions, setting realistic payment and performance expectations and documenting all changes in writing.
If you have entered into a contractual agreement, seeking legal advice can be the difference between lengthy litigation and quick resolutions, should problems arise. Legal assistance is also recommended to ensure your contractual agreements are “bullet-proof” and legally sound, ensuring you side-step any potential litigation issues further down the road.
Need help with a contract dispute? Jones Whyte’s experienced contract dispute lawyers in Scotland are readily available and happy to assist.
Table of Contents
- 7 common causes of contract disputes
- How to avoid them
- What do contract dispute resolution lawyers do?
- The benefits of using Jones Whyte’s dispute resolution lawyers
- Key takeaways
- Frequently asked questions
7 Common Causes Of Contract Disputes
Here are seven common causes of contract disputes:
1. Breach of contract
This is the most common cause, where one party fails to fulfil their commitments under a lawful agreement. There are two main types of contract breaches in Scotland:
Material breach: This is a serious infringement of the contract that significantly interferes with the contract’s purpose. It allows the innocent party to terminate the contract and claim damages for any losses suffered. For example, a supplier fails to deliver machinery for a construction project by a specific date, causing the contractor to miss essential deadlines.
Minor breach: These are less serious offences that do not necessarily allow the innocent party to end the contract. Instead, they can usually seek damages or compensation for any losses. For instance, a furniture removal company agrees to a delivery within three days. However, the delivery is delayed by one day due to inclement weather but the furniture arrives in perfect condition.
2. Ambiguity of contract terms
A dispute may arise when vague or unclear language is used within a contract, resulting in misunderstandings about specific requirements. If certain agreement terms are not explained explicitly, it can cause confusion, misunderstandings, and legal disputes. For example, phrases like “reasonable efforts” or “as soon as possible” can confuse parties about their legal responsibilities.
3. Payment issues
Payment issues are another common cause of contractual disputes and may occur for many reasons. These could be anything from late payments, disagreements on the amount/s owed, errors in billing or invoicing, or discrepancies in exchange rates for international contracts.
For instance, delayed payments can cause substantial financial strain to businesses, leading to cash flow problems and potential business failure.
4. Performance issues
Performance discrepancies occur when one party believes that the other has not honoured their contractual obligations to a specific standard. This could involve:
- Failure to meet quality standards – when work delivered does not meet quality standards.
- Expectation misunderstanding – when one party misinterprets performance criteria or goals.
- Incomplete work – work is left unfinished, causing delays and frustration.
- Delayed delivery – work is not delivered within the agreed-upon timeframe.
5. Misrepresentation or fraud
Disputes can arise when one party provides false information when entering into an agreement, influencing the other party’s decision to sign a contract. For example, you agree to buy a fast-food franchise business, only to discover it doesn’t exist or is not as profitable as you were led to believe.
6. Contract variations
Changes to an existing contract are common, especially in long-term projects, but they can lead to disputes if not communicated or documented correctly.
For example, a homeowner might hire a contractor to repair their roof but later ask them to also repair the windows. However, they do not discuss costs or timeframes, or have the agreement in writing, and when the contractor charges for the additional work, the homeowner refuses to pay.
7. Termination/exit clauses
Conflicts and disputes can happen when either party is unclear about the termination of their services. Disagreements may arise over notice periods, exit fees, or return of property/assets when the job is complete. For instance, a marketing manager does not return a company laptop when their employment contract is up, or there is a misunderstanding in exit fees when switching to a new energy supplier.
How To Avoid Contractual Disputes
Here are a few ways to avoid the above-mentioned contractual disputes:
- Use clear language: Avoid vague phrases and jargon by using clear, simple language that everyone can understand easily. Clearly define any terms that might sound ambiguous or confusing by being as specific as possible.
- Ensure everyone understands their obligations: Go over the contract with all parties involved to ensure everyone understands their legal rights, roles, duties, and obligations. Encourage open communication and ask/answer questions to clarify any doubts or concerns.
- Set realistic performance expectations: Set achievable deadlines and performance standards and consider potential obstacles and setbacks. For instance, you might provide some wiggle room for contractor projects due to inclement weather.
- Be clear on payments: State and review payment terms clearly, including the amount due, exchange rates (if applicable), payment date, late payments, and payment method/s.
- Seek legal advice: Use qualified contract dispute resolution lawyers to review the contract terms before signing any agreement. This proactive step ensures that all loopholes are covered and provides the opportunity to make any formal amendments before they escalate to bigger issues.
- Document changes in writing: To prevent disputes, ensure all changes to the original contract are in writing.
- Clarify termination/exit clauses: Explicitly state and review termination clauses within the contract, specifying notice periods and including a clause outlining the process to resolve disputes.
What Do Contract Dispute Resolution Lawyers Do?
Jones Whyte’s contract dispute solicitors play a crucial role in managing and resolving disputes between parties involved in various contractual agreements. We help our clients navigate complex legal issues to achieve the best outcome.
Here’s what we do:
- Legal advice: We provide top-class legal assistance when it comes to interpreting contracts, rights, and obligations. With our considerable experience, we review contracts and help our clients understand all parties’ legal rights. We will advise our clients on whether they have a strong case to make a claim or suggest other alternative resolution methods like negotiation or arbitration, should conflicts arise.
- Risk assessment: By reviewing contracts, we advise our clients on possible loopholes that could lead to disputes further down the line and create robust modifications or updates to the contract/s to avoid this. This proactive approach can save our clients both time and money by addressing possible issues before they escalate to formal disputes.
- Negotiation and mediation: Conflict management often begins with negotiation between parties to reach a fair and favourable outcome. This means we work with the other party to negotiate settlements without going to court. If negotiation fails, the next step is arbitration or mediation, in which a neutral third party assists in resolving the conflict at hand.
- Litigation: Our litigation solicitors will represent their clients in court if disputes are unresolved after mediation. This court action involves preparing legal documents, presenting evidence, and arguing on our client’s behalf to seek a favourable judgment. We have extensive experience in the Sheriff Court, Court of Session, Lands Tribunal for Scotland, and Scottish Land Court.
- Drafting dispute resolution clauses: Our lawyers work tirelessly to enforce the terms of your contract, helping you get what you are owed. In cases where our clients are accused of breach of contract, we’ll pinpoint any discrepancies or ambiguity to reduce liability and protect your rights.
Whether you’re a business facing commercial litigation or an individual seeking compensation, Jones Whyte can help you achieve the best possible outcome.
The Benefits Of Using Jones Whyte’s Dispute Resolution Lawyers
Here’s why partnering with Jones Whyte as your chosen dispute resolution lawyer is a smart move:
- Legal expertise: Our Glasgow-based litigation team has over a decade of extensive experience in dispute resolution. From franchise and director disputes to claims against surveyors or architects, we’re the team you can trust.
- Honest advice: We don’t hold back in letting you know exactly what the strengths and weaknesses of your position are pertaining to your case. We respond quickly and offer clear, concise advice that gives you clarity and peace of mind.
- Personalised solutions: We understand there is no one-size-fits-all approach when it comes to contractual disputes and offer a tailored approach for each of our clients. We work tirelessly to achieve the best outcome, ensuring your best interests and legal rights are taken into account.
- Compliance: Jones Whyte is accredited by the Law Society of Scotland, ensuring your affairs are above board and compliant with Scots Law.
- Transparency: We provide complete cost transparency and will always give you a clear price before we start, ensuring no hidden costs or surprises.
Key Takeaways
- Every transaction is regulated by contract law under Scots Law.
- Breach of contract and ambiguity of terms and payments are common causes of contractual disputes.
- To avoid them, use concise language, set realistic expectations, and document contract changes in writing.
- There are two main types of breach of contract in Scotland: material and minor breach.
- Use Jones Whyte’s professional dispute resolution lawyers for legal advice, settlement negotiation, dispute mediation, and litigation preparation when disagreements arise.
Jones Whyte Is Here To Help
Dispute resolution doesn’t have to be stressful and overwhelming when you have Jones Whyte’s litigation solicitors on your side. Whether you’re navigating commercial disputes or debt recovery, contact our professional team today.
Please note: This article is for general information purposes only and does not constitute legal advice. It should not be relied upon as a substitute for professional legal advice tailored to your specific circumstances. If you need advice on a legal matter, get in touch with our team.
