Imagine this scenario: A business owner has just closed a financially beneficial deal, but when reviewing the contract again, they notice a typographical error. Maybe a name is misspelled or a date looks off. Does this mean the contract is now worthless?
Minor mistakes rarely void an agreement
While Maryland courts place a high value on the written language of a contract, they distinguish between a substantive dispute and a simple “scrivener’s error.” If clear evidence shows that a typo or clerical mistake contradicts the parties’ actual intentions, the court can look past the technicalities to enforce the deal originally agreed.
The reason is straightforward: Courts prioritize the substance of the deal over perfection in the paperwork. When both parties understand their obligations and perform accordingly, a technical slip usually does not change the outcome.
Technical errors can become serious problems
A mistake becomes problematic when it changes a fundamental term of the agreement. Consider these examples:
- Listing a purchase price as $10,000 instead of $100,000
- Stating payment terms of 30 days when both parties agreed to 90 days
- Describing goods or services in a way that does not match the prior discussions
- Incorrectly identifying one of the contracting parties
When a significant error exists, courts may consider additional evidence to determine what the parties agreed upon. Through a legal process known as contract reformation, a court may modify the written document to align with the parties’ actual intent.
This process, however, requires clear and convincing evidence that both parties intended terms different from those reflected in the written contract. In the absence of such evidence, each party may remain bound by the terms as written.
Ways to protect against contract errors
The best way to avoid business contract disputes is surprisingly simple: catch mistakes before they become problems. It is vital for parties to read through every contract carefully before signing it. Even experienced business owners sometimes skim through documents, and that is when important details can be overlooked.
When a mistake does happen, contacting the other party immediately can often solve the issue. Legal counsel can provide valuable assistance in documenting the error and coordinating appropriate amendments without unnecessary complications.