Are there grounds to challenge a business contract?

In Business Organizations by Coolidge Wall

Contracts can be one of the most important tools protecting your company right now. These legal documents are crucial in establishing expectations, defining roles and setting boundaries that can prove to be critical in just about any industry.

However, a contract is only as strong as its terms. This means that if you are party to a contract that has unenforceable terms, the entire agreement itself may be voided. 

There are many different reasons why a contract or certain clauses may be deemed invalid. They can be challenged if they are:

  • Inherently unfair to one party
  • Illegal or include violations of public policy
  • Inaccurate
  • Fraudulent

Further, a court can invalidate a contract if there is evidence that one party:

  • Was coerced or threatened into signing the document
  • Lacked the capacity to agree to a legal contact
  • Was misled about certain clauses or terms
  • Did not understand what they were signing due to language barriers

In these situations, it is generally wise to explore the legal options for disputing a contract. However, it should be noted that these situations and elements are not always as obvious as you may hope, and intentions can be highly subjective.

For instance, even if there is a mistake in a contract, it must be proven that it was an important mistake that had a significant impact on how parties bargained or performed. Or you may feel as though coercion played a role in contract signing or negotiations, but the other party can deny any such allegation and argue that there were no threats or intimidation tactics used.

Because of how complicated these situations are and how much can be at stake in a contract dispute, legal guidance can prove to be crucial. An attorney can help you navigate the legal process, whether that includes arbitration, mediation, negotiation or litigation.