Common Florida Business Contract Mistakes

Common Florida Business Contract Mistakes

Contracts and agreements are a vital aspect of doing business in Florida. Nearly every aspect of owning and operating a business requires a contract or agreement. Parties to common business contracts include:

• Employees and contractors
• Landlords and tenants
• Co-owners, shareholders and partners
• Vendors and suppliers
• Customers, clients and consumers

Avoiding business contract disputes

Unfortunately, many business disputes and lawsuits arise from contract issues. For help avoiding unnecessary disagreements at the drafting, negotiating, compliance or termination stages of an agreement, avoid these common mistakes with your business contracts:

• Unintended agreement: Whether or not a bargain was intended, an action or an oral statement may create an obligation. For example, if Company asked Supplier if it could provide Company with 100 widgets and – instead of replying – Supplier delivers the widgets, an enforceable agreement may exist.
• No written contract: While handshakes and oral agreements may have been normal in certain industries or small businesses, failing to have written agreements will often expose the parties to potential risks and liabilities. If a dispute arises, the case may have to be decided on “he said, she said” evidence.
• Vague language: Contracts should contain details regarding the rights and responsibilities of the parties. Terms that are too general or are confusing can cause misunderstandings, too often leading to unrealized expectations, delayed deliveries or unhappy customers.
• Varying terms: If the written contract does not contain all of the negotiated terms and provisions, the omitted portions are not enforceable. For example, Company A orally agrees to provide two widgets and a doodad to Business B by the end of the month. However, if the contract only mentions the widgets, Business B may not be able to enforce delivery of the doodad. As another example, a contract states that Supplier will ship products to Retailer. If Supplier says that shipping costs are included during a phone conversation but it is not part of the written contract, Retailer may be forced to pay the shipping costs.
• No way out: Circumstances can change, making compliance impossible or unfeasible. Anticipate potential issues and outline in writing how they should be addressed and resolved.

The No. 1 mistake made by Florida business owners

The best way to avoid contract disputes is to consult an experienced business lawyer for assistance with negotiating, reviewing and drafting your agreements and contracts. The attorneys at Kuhn Law Firm, P.A., can help.