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Differences in contractual interpretation lead to lawsuits

Each day businesses all across New Jersey make contracts with new partners, venders and other business entities. Those contracts spell out the details that the contracting parties agreed to before putting themselves on the line for any damages the other parties may experience in the event of breaches. Unfortunately, even at the time of contracting some parties both read the same agreement and interpret the terms in very different ways.

When this problem occurs each party to the agreement has a different contractual interpretation of the document's terms. For example, an unclear damages clause may be read by one party to allow for liquidated damages but by the other to prohibit them in the event of a lawsuit. Whether or not a party can pursue liquidated damages can have a big impact on the size of recovery the aggrieved party can receive in court.

One of the best ways to avoid problems of contractual interpretation in a business relationship is to ensure that all contracts are drafted and reviewed by involved parties before signing. Through the process of negotiation the parties should discuss all of the terms of an agreement and find common ground before finalizing its language. Working with an experienced business law attorney can be an effective way to achieve just such a harmonious contractual collaboration.

The attorneys of the Donnelly Ritigstein Law Offices have extensive experience working with business clients to prevent such problems of contractual interpretation from ever happening. However, they also realize that even the best agreements can be subject to later scrutiny. For that reason, they are prepared to help their clients settle contract disputes and business litigation matters with zealous advocacy.

Contracts should include the agreed-upon terms of the contracting parties. It is possible for some parties to agree even though they each read those terms in different ways. The Donnelly Ritigstein Law Offices can help businesses avoid this problem by minimizing opportunities for contractual interpretation problems to arise.

Source: For more information, please visit our Business Litigation page.

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