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How to Handle Contract Breaches Without Litigation: A Practical Playbook for Miami-Dade Businesses

Step 1: Triage the Breach (Facts, Dollars, Deadlines)

• What exactly was promised? Pull the signed contract, SOW/PO, exhibits, change orders, and any emails or messages (text/Slack) that amended the deal.
• Delivered vs. due: Build a simple variance table: date, deliverable, contractual standard, actual performance.
• What dollars are at stake? Credits, rework or replacement costs, internal time, delay penalties, and downstream exposure to your own customers.
• What deadlines control? Cure periods, notice requirements, milestones, force majeure, and renewal/termination windows.

Step 2: Preserve Rights Without Burning Bridges

• Contract citation (section and exhibit).
• Specific variance (what, when, how much).
• Cure window under the contract (or a reasonable date if silent).
• Initial business solution (credit, rework plan, partial shipment, temporary staffing).
• Request for a written response and a scheduling call.

Step 3: Pick the Track—Fix the Work, Fix the Money, or Exit Cleanly

• Performance track (fix the work): Rework plan, replacement, punchlist with dates, and objective acceptance criteria (tests, checklists, photos).
• Money track (fix the price): Credits, discounts, resequenced milestones, or a temporary price adjustment tied to KPI recovery.
• Exit track (fix the relationship): Mutual termination, wind-down support, return of data/keys, and a mutual release.

Step 4: Use a Step-Down “Resolution Ladder” (Maintain Momentum, Not Emotion)

• Operations call (project managers) within 48 hours—agree on facts and a draft cure plan.
• Executive call (owners/VPs) within 5–7 days—lock dollars and schedule.
• Mediation in Miami-Dade within 10–14 days if needed—neutral mediator, half day, short briefs, English controlling with Spanish support if helpful.
• Arbitration or court only if everything else fails.

Step 5: Building Blocks of a Strong Pre-Suit Settlement

• Scope: What tasks, invoices, or SKUs are covered—and what isn’t.
• Cure plan & timeline: Dates, acceptance criteria, inspection windows, and who pays for what.
• Money terms: Credits, refunds, milestone changes, or a payment plan (dates, method, late fees/interest).
• Security: Personal guaranty (when appropriate), UCC-1 on key equipment, or a standby letter of credit for larger exposures.
• Releases: Narrow, mutual release tied to the covered items—carve out future performance and unrelated issues.
• Confidentiality & non-disparagement: Keep it out of the press and vendor review sites.
• No admission of liability: Standard cooling language.
• Dispute ladder & venue: Mediation first; Florida law; Miami-Dade venue.
• Default & remedies: Cure chance for payment-plan misses, then acceleration or reversion to original claims.

Step 6: If the Problem Is Money—Collections Without Court

• Friendly reminder (5–7 days past due) with the contract, invoice, proof of delivery, and a “what’s blocking payment?” tone.
• Formal default notice (15+ days) citing contract terms, interest/fees, and a cure date.
• Negotiation call: Offer a short payment plan (weekly/biweekly), a modest discount for immediate wire, or a swap (you waive late fees for guaranteed ACH).
• Settlement paper: Payment plan + security (guaranty/UCC) + conditional release (release expands as payments clear).
• Suspend services (if allowed) until payments resume; promptly resume when milestones are met.

Step 7: If the Problem Is Performance—Cure Without Chaos

• Punchlist + acceptance tests: Replace “make it right” with checklists and measurable standards.
• Rework windows: Defined timelines (e.g., 10 business days) and one consolidated inspection to avoid death-by-revisits.
• Temporary workarounds: Interim vendor or subcontractor at the breaching party’s expense, with cooperation duties (access, data).
• Credits with cliffs: Partial credit now; additional credits only if KPIs aren’t met by a date.
• Escalation path: Pre-scheduled weekly manager/executive check-ins until completion.

Step 8: Tolling Agreements (Pause the Clock While You Talk)

Step 9: Protect Your Reputation and Pipeline

• Client communications: If a vendor delay hits your customers, send a short, factual update with a new delivery date—no finger-pointing.
• Social media & reviews: Pair settlement confidentiality with non-disparagement to avoid online skirmishes.
• Internal message: Share the need-to-know: what changes, who approves, and where to log issues.

Step 10: Prevent the Next Breach (Upgrade Your Templates Now)

• Change orders with automatic time and price adjustments.
• Acceptance criteria and rework windows (objective tests; photo evidence).
• Payment mechanics: deposits, progress billing, interest/fees, suspension rights, and prevailing-party attorney’s fees.
• Limitation of liability and indemnity scaled to risk.
• Insurance: additional insured, primary/non-contributory, and waiver of subrogation where appropriate.
• Dispute ladder with pre-suit mediation in Miami-Dade and fast scheduling rules.
• Bilingual exhibits for Spanish-speaking teams, while keeping English controlling.

14-Day, No-Litigation Roadmap

Five Common Mistakes (and the Antidote)

• Angry emails instead of notices. Do this: Send a formal breach notice citing the contract and inviting a cure.
• Vague “we’ll make it right” promises. Do this: Use punchlists, dates, and pass/fail tests.
• All-or-nothing demands. Do this: Offer options—discount, payment plan, or rework—and lock the choice in writing.
• Payment plans without security. Do this: Add a personal guaranty, UCC-1, or standby LC sized to the risk.
• Fixing the symptom, ignoring the template. Do this: Update your MSA/SOW with change orders, acceptance criteria, and a dispute ladder.

How We Help—Quietly and Fast

• Draft breach and cure notices that preserve rights and invite solutions
• Lead targeted negotiations (ops then executive) to land rework plans or payment resolutions
• Prepare settlements, payment plans, guaranties, and UCC filings
• Set up pre-suit mediation with seasoned neutrals (English controlling; Spanish support available)
• Upgrade contract templates (MSA/SOW, sales terms, vendor agreements) with dispute ladders and measurable standards

Let’s Talk