Have a contract dispute? Try arbitration

Contract disputes can turn a business arrangement sour. For most people, a dispute can be easily resolved by talking the problem through with the other party. Both parties might decide to break the contract and move on, or one might agree to be financially responsible for mistakes they made.

Sometimes, it’s not that easy to handle a contract dispute. If neither side is willing to negotiate, then you may have to turn to the law for support.

Check your contract: Did you agree to arbitration?

The first thing to look at in your contract is if you agreed to an arbitration clause. If you did, then you should be aware that you must go through arbitration to try to resolve any disputes that take place.

With arbitration, an arbitrator, who may be a former judge, for example, will listen to both parties make their arguments. The arbitrator will then make a binding decision. This is similar to a trial, but it’s less formal. It takes less time and is more cost effective.

If you do not have an arbitration clause in your contract, then you may be free to file a lawsuit. It may be better to speak with the other party or to negotiate between your attorneys than to go to court since a settlement is usually more cost-effective and time-efficient. If you plan to negotiate outside court, both sides will need to agree to mediation, negotiations through your attorneys or another arrangement. If you’re not willing to negotiate, then a trial may be the only course of action that will help.