The 7 Clauses That Cause the Most Business Disputes in Maryland Contracts
Most business disputes don’t start with bad intentions.
They start with a contract that seemed standard.
A vendor agreement copied from another deal.
An employment contract signed quickly to close a hire.
A partnership agreement that assumed “we’ll figure it out later.”
Later is usually when the dispute shows up.
Below are the seven contract clauses that cause the most problems for Maryland businesses, explained in plain English—no legal jargon, no scare tactics. Just what to watch for before a disagreement turns into a lawsuit.
1. Payment Terms (and What Happens When Someone Doesn’t Pay)
Why it causes disputes:
Because everyone assumes payment terms are “obvious”—until they aren’t.
What goes wrong:
- Vague due dates (“net 30” without a start date)
- No penalties for late payment
- No clarity on partial payments or refunds
Real-world example:
A service provider finishes the work. The client delays payment for months, claiming dissatisfaction—despite no dispute process in the contract.
What to look for:
Clear deadlines, consequences for non-payment, and defined dispute procedures.
2. Termination Clauses
Why it causes disputes:
Because “ending the relationship” is when emotions run highest.
What goes wrong:
- One side can terminate instantly, the other can’t
- No notice period
- No clarity on what happens after termination
Real-world example:
A business partner exits suddenly and takes key clients—because the contract never restricted it.
What to look for:
Balanced termination rights and a clear roadmap for what survives after termination.
3. Scope of Work (What’s Actually Included)
Why it causes disputes:
Because assumptions fill in the gaps.
What goes wrong:
- Vague descriptions of services
- Undefined deliverables
- No boundaries on revisions or additional work
Real-world example:
A vendor believes ongoing support is included. The client believes it’s “extra.” The contract doesn’t say either way.
What to look for:
Specific deliverables, timelines, and limits on additional requests.
4. Non-Compete and Non-Solicitation Clauses
Why it causes disputes:
Because these clauses affect livelihoods—and Maryland courts scrutinize them closely.
What goes wrong:
- Overly broad restrictions
- Unenforceable time or geographic limits
- One-sided obligations
Real-world example:
A former employee starts a competing business. The employer assumes the non-compete applies—only to find it may not be enforceable.
What to look for:
Reasonable limits tailored to the actual business interest being protected.
5. Indemnification Clauses (Who Pays When Things Go Wrong)
Why it causes disputes:
Because indemnity clauses quietly shift financial risk.
What goes wrong:
- One party unknowingly assumes all liability
- No caps on damages
- Coverage that extends beyond control
Real-world example:
A small business is forced to cover legal costs for another party’s mistake—because the contract said so.
What to look for:
Clear limits on responsibility and alignment with insurance coverage.
6. Dispute Resolution Clauses
Why it causes disputes:
Ironically, because they decide how disputes are handled.
What goes wrong:
- Mandatory arbitration without understanding the cost
- Out-of-state venue requirements
- No process for informal resolution first
Real-world example:
A Maryland business discovers it must resolve a dispute across the country—because of one overlooked clause.
What to look for:
Venue, governing law, and whether alternative dispute resolution actually benefits you.
7. Amendment and “Entire Agreement” Clauses
Why it causes disputes:
Because verbal promises don’t survive these clauses.
What goes wrong:
- Side agreements never documented
- Email promises contradicted by the contract
- No clear process for changes
Real-world example:
A client relies on an email assurance—only to learn the contract explicitly excludes it.
What to look for:
A clear amendment process and alignment between the contract and real-world practice.
Why This Matters More Before You Sign
Most business owners review contracts after there’s a problem.
That’s when options narrow—and costs rise.
A short legal review before signing can:
- Surface hidden risks
- Clarify obligations
- Prevent disputes that cost far more to resolve later
Final Thought
If you’ve signed contracts without a legal review, it may be worth having an attorney assess your exposure—especially if those agreements involve vendors, employees, or long-term partnerships.
A contract shouldn’t be a gamble.
It should be a tool that protects your business when things don’t go as planned.
Frequently Asked Questions About Business Contracts in Maryland
Do I really need a lawyer to review a “standard” contract?
Yes — and this is one of the most common misconceptions.
Most business contracts are drafted to protect the party that wrote them. Even “standard” templates often include clauses that shift risk, limit your rights, or create obligations you wouldn’t expect.
A legal review isn’t about rewriting everything. It’s about identifying exposure before it becomes expensive.
What if I’ve already signed the contract?
That’s more common than you think.
While some terms can’t be changed retroactively, a review can still:
- Clarify your obligations
- Identify enforceability issues
- Help you plan next steps before a dispute arises
In many cases, understanding your position early can prevent escalation.
How much does a contract review usually cost?
It depends on the complexity of the agreement, but a review is typically far less expensive than resolving a dispute later.
Think of it as risk management, not a sunk cost.
The goal is to catch issues early — not bill hours unnecessarily.
Are non-compete clauses always enforceable in Maryland?
No.
Maryland courts closely examine non-compete and non-solicitation clauses. Overly broad restrictions — especially those with unreasonable timeframes, geographic limits, or job scope — may not hold up.
Whether a clause is enforceable depends on how it’s written and how it applies to the specific role or business interest.
What types of contracts cause the most disputes?
The most frequent issues arise from:
- Vendor and service agreements
- Employment and independent contractor contracts
- Partnership and operating agreements
- Commercial leases
These contracts tend to involve ongoing obligations — which is where ambiguity causes problems.
Can a contract be enforced if it’s vague or poorly written?
Sometimes — and that’s the problem.
Courts may still enforce unclear contracts, often in ways neither party expected. Ambiguity doesn’t always void an agreement; it often creates leverage for disputes.
Clarity protects everyone involved.
When should I have a contract reviewed?
Ideally:
- Before signing
- Before renewing or amending an agreement
- When your business is growing or changing
- If a relationship starts to feel strained
Waiting until there’s a conflict usually limits your options.
What’s the biggest mistake business owners make with contracts?
Assuming goodwill will fill in the gaps.
Contracts exist for when things don’t go smoothly. A well-reviewed agreement sets expectations clearly — so disagreements don’t turn into legal battles.
