As a business owner, you approach a local vendor about suppling some of your needs for parts and materials. The meeting goes well. They agree to make some deliveries and you agree to pay. You shake hands, and the other business owner walks you to the door.

It can feel a bit awkward, at this point, to ask for more than a handshake deal. But you have to put your company first. As such, you always want to ask to have that contract in writing.

The problem is that you have no proof of a handshake deal. As long as all goes well, it’s fine. If there is a breach of contract, though, what do you have to fall back upon? You also open the door to miscommunication when the terms aren’t clearly spelled out.

For instance, say that the vendor is supposed to make every delivery on Monday. One week, they don’t show up until Wednesday. You miss a lot of orders and lose a lot of profit because you spend days without the parts you need. Production grinds to a halt.

You confront them, and they say that they just thought they needed to make the delivery once a week. Maybe it’s just miscommunication, and they actually did think that. Maybe they’re lying to cover up for the mistake. Either way, if you do not have the contract written down, you have nothing to turn to as you seek to show who is correct. This makes the situation infinitely more complicated.

In all breach of contract situations, make sure you are well aware of your legal rights.