The contracts should clearly define mutual rights and responsibilities, minimizing the possibility of a dispute. Despite this, one or both parties fail to perform their contractual obligations, resulting in a breach of contract. Violations giving rise to a conflict can occur for various reasons. Sometimes one party fails to deliver the goods or services on time or sends goods that do not fit the agreed-upon purpose. Also, failing to pay the price on time constitutes a breach of contract, resulting in a dispute.
Why do parties violate contractual terms? The answer is not simple. Contract breaches sometimes result from intentional acts or omissions. In other cases, ignoring contractual obligations occurs due to unclear expectations or vague and confusing clauses.
1. Material contract breach occurs as a consequence of grave violations of contract responsibilities, compromising its integrity. The material breach gives the complying party right to seek damages, but subsequent performance is impossible.
2. Non-material breach means violating contract provisions does not have a decisive impact on the contract. The other party can still seek performance in addition to recovering damages.
Mediation is an out-of-court dispute resolution method that offers multiple advantages over litigation. As an alternative to the court process, mediation allows parties to negotiate and settle their dispute, continuing their fruitful cooperation.
When a contract dispute arises, parties entrust the resolution to a third neutral person called the mediator. The mediator is a retired judge or an attorney with special negotiation skills and subject matter experience. The parties choose the mediator voluntarily. In contrast to state-appointed judges, mediators do not have decision-making authority, nor can they propose a solution or give legal advice.
The mediation process is informal and flexible, typically consisting of four stages. In the introduction, the mediator introduces themselves, explaining the procedure to the parties. Next, parties can give opening statements regarding the dispute. After that, each party goes to a separate room for private talks with the mediator (caucuses). Hearing their arguments privately, the mediator estimates the possibility of settling. Finally, parties sit together in a joint session during which they negotiate, bringing offers and counteroffers. The role of the mediator is to facilitate negotiations and motivate the parties to settle their dispute.
Unlike public litigation, mediation is confidential. Participating in mediation means parties cannot reveal anything shared during sessions. The information disclosed during mediation cannot serve as evidence in potential litigation too.
Mediation offers one unique advantage that litigation lacks. Unlike an adversarial court process, mediating a contract dispute allows the parties to find common ground through negotiations. Settling has a positive impact on their business relationship. Despite the disagreement, the parties can continue their relationship after resolving the conflict.
The final stage is signing the mediation agreement and settling the dispute. After the parties put in their signatures, it is binding and enforceable.
David L. John is a distinguished Florida mediator with over 30 years of experience. Working in various business branches, Mr. John has the necessary insider knowledge to cope with the most contested contract disputes.
Using sophisticated negotiation skills, David can help you settle your contract dispute while maintaining a successful business relationship.
Please call today to schedule your free appointment.
