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Some legal implications of supply chain disruptions

On Behalf of | Feb 2, 2023 | Business Law |

In recent years, businesses in Ohio and throughout the world have experienced significant supply chain disruptions. Since the failure to provide materials as promised could lead to a breach of contract, many legal matters come into play.

The approach a company takes depends upon the situation including the long-term relationship with a valued supplier.

Negotiating a commercial solution

Information from an article in the National Law Review stresses that business solutions might work out better than litigation in many cases. An aggressive lawsuit could burn bridges and result in a broken relationship with a needed supplier. A company might win the battle but lose the war.

A key concept here falls into the category of reasonable. Businesses should attempt to understand the circumstances that lead to a failure to deliver products on time. If a reasonable solution exists to a supply chain problem, legal action might not succeed in a court of law. All parties should communicate and work in good faith as much as possible to reach a solution.

Considering a legal action

At times, legal action might become the right step in the case of a breach of contract. Companies should look closely at their contracts and understand their provisions. When a supplier fails to supply items on time, this could lead to added expenses for a company, making legal action necessary.

Since each contract might have exceptions that excuse or mitigate supply chain disruptions, such as government orders or natural disasters, it is important to understand how they could impact legal outcomes. The decision to pursue legal action in supply chain matters depends on many factors.


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