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Did a supplier breach its contract with you?

| Nov 11, 2020 | Breach of Contract

As a business owner, you may spend a considerable amount of time working with suppliers. While this is necessary to the overall well-being of your company, it also has the potential to bring about challenges and disagreements.

If a supplier breaches its contract with you, you’re put in a difficult spot. This is especially true if you’ve had a good relationship up until that point.

Here’s what you should do if you find yourself in this position:

  • Review your contract: This is where you’ll find the terms and conditions associated with your agreement, thus giving you an idea of where your supplier went wrong.
  • Assess the damages: You need a clear idea of the damages associated with your claim. For example, if the breach of contract resulted in lost wages or profits, estimate how much.
  • Talk to your supplier: Before you take any advanced action, such as filing a lawsuit, talk to your supplier about your concerns. If nothing else, this gives you the opportunity to learn more about their situation and hear their side of the story. You hope this is enough to get your relationship back on track.
  • Opt for mediation: This doesn’t always work, but you can try mediation if you think you’ll be able to find common ground.
  • Take legal action: You don’t want to go down this path, especially if you’ve had a good relationship with your supplier in the past, but it may be your only option. By taking legal action, you show the other party that you’re serious. You also position your company to recover damages.

While all of these steps are important, you must follow them in order. For instance, you don’t want to file a lawsuit against your supplier until you first review your contract, assess the damages and talk to them directly.

A breach of contract is a big deal on many fronts. It costs you time and money, while also forcing you to find a new supplier.

However, if you find yourself in this position, you shouldn’t delay in taking action. Things aren’t likely to get better without intervention.

Questions? Contact Us.

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