As most business owners in Murfreesboro know, running a company or establishment usually means partnering with other entities. The parties typically establish these relationships by signing a legal contract or agreement. Examples of potential contract parties include:
- Vendors or suppliers
- Contracting companies
- Equipment providers
In many cases, these relationships can last for years, especially when the parties have a fair and mutually beneficial legal contract. However, not all working relationships succeed, and you may one day feel the need to end your arrangement before your contract expires.
It’s all in the details (of the contract)
One of the most beneficial aspects of a legal agreement is flexibility. If they are fair to both parties and violate no laws, you can include many valuable clauses in your contracts. Two clauses to consider that may pave the way for legally ending a contract include the following.
For default: If your contracts have a “cancellation for default” clause, you may qualify to end these contracts legally. When other parties do not comply with the terms of a signed contract, essentially defaulting on the agreement, this clause gives you a legal exit strategy.
By mutual consent: In most circumstances, neither party wants to resort to business litigation when a contract dispute arises. Often, adding a “cancellation by mutual consent” clause creates a way for parties to exit a contract if the partnership is not working. It is also beneficial should the circumstances of either party change and they need to end the agreement.
When you work with multiple people and organizations, sound contracts are your first line of defense against business litigation. Learning more about business and contract law can help you operate with fewer legal problems for years to come.