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2 factors that can impede contract enforceability

On Behalf of | Apr 9, 2021 | Business Law

Contracts are a critical aspect of running a business. Whether your company provides services or creates products, contracts are necessary to ensure that every aspect of each business transaction goes smoothly. Also, business contracts help prevent confusion, miscommunication and operational issues. 

The purpose of a contract is to outline the goals, expectations and instructions on how to meet those expectations for all parties. Contracts also contain steps all parties should take in the event of a breach. Breaches can occur for many reasons, not all of them are easy to resolve and sometimes the terms in contracts are unenforceable because they violate rights or other legal agreements. To prevent contractual issues from going to litigation or becoming lawsuits, consider the following information. 

Confusing/irrelevant terms

Contracts often contain terminology that may seem confusing or difficult for some to understand. It is not uncommon for some business owners to use templates and other confusing terms in their contracts. Issues with contract enforcement can arise when one party does not understand the terms, even after signing. 

Unenforceable terms

As crucial as it is to use contracts, not all agreements are legally enforceable. Some contracts are enforceable, but they contain terms that result in conflict and disagreements. No matter the number of parties involved, if a contract contains unlawful or confusing language, enforcement could become problematic and require legal intervention. 

In the business world, anything can happen that calls into question the legalities of contracts. To keep all contractual parties on the same page and minimize the likelihood of disputes, carefully review all contracts for understanding and compliance and negotiate when necessary before agreeing and signing.