Weirdly, avoiding disputes does not seem to be a key factor driving the drafting of contracts (although PPC2000 might be an exception). However, given the rising cost and time involved in resolving disputes, as well as the damage to reputations and the sustainability of a company, it should be.
My newsletters (sign up) consider how you can use your contracts to avoid disastrous disputes which take time, money and your energy away from running a successful business. Here are some ideas to help avoid disputes before you sign on the dotted line, in order of the steps you should be taking:
- Focus on clarity and certainty of terms (2 March)
- Record what has been agreed, without adding nasties ‘just in case’ (17 February)
- Write your scope so clients can tell when works or services are extras (6 July)
- Read and read and read again to ensure your contract cannot possibly be misunderstood (30 March)
- Get your contract peer-reviewed to see if it really makes sense and accurately records your deal (8 June)
- Build good frameworks rather than relying on tried and tested clauses (26 May)
Once your contract is in place then you need to:
- Use your contracts to provide processes to resolve problems, not wriggle out of liability (27 April)
- Keep on innovating rather than sue imitators (22 December)
- Follow the procedures properly (8 December)
- Don’t let bad payment practices become the norm – gently nudge those who get it wrong (24 November)
- Admit failures by interpreting the data (10 November)
- Rely on limits to cut off old claims (25 October)
You should not assume that other businesses are ‘out to get you’ (5 Jan), or pin your hopes on a watertight contract (12 May). Instead draft a contract based on the 97% who will be trustworthy (more on trust).