When you run your own construction company, you know that you face hurdles with every project you take on. You rely on suppliers and subcontractors to help you complete your work, which sometimes can lead to big problems. At some point, you are more than likely to end up in a breach of contract dispute, when a business you are working with doesn’t live up to their contract obligations.
Breach of contract disputes become more problematic when they are material breaches. That means the essence of the contract hasn’t been followed, causing a major financial impact.
Causes of breach of contract disputes
Some of the main causes of material breach of contracts in the construction industry are the following:
- A supplier, subcontractor or general contractor doesn’t meet the contract deadline for delivering goods and services, costing your business money because of the delay.
- A material used in a project has a defect, which causes delays and increased costs to fix.
- A subcontractor or supplier failed to provide the goods or services outlined in the contract.
What to do about a breach of contract
When you become involved in a breach of contract dispute, you first should try to work out the problem with the other party. If you can’t come to an agreement, you should consider filing a lawsuit for breach of contract. You can recover the financial losses you incurred due to project delays, product defects and more.
You also could pursue alternative dispute resolution, either using a mediator or arbitrator to resolve your dispute. Working to resolve your dispute outside of court will save on legal fees and allow the process to move more quickly.
Dealing with a breach of contract dispute can is frustrating and can feel overwhelming. However, you have to protect your business’ bottom line and its reputation. When a breach of contract ends up significantly impacting your business, you need to move forward to find a solution.