Vendor relationships keep your business running. You depend on them showing up, delivering what they promised, doing the work they said they’d do. So when a supplier doesn’t deliver goods on time, or the services they provide fall way short of what you agreed to, or they just disappear entirely, it throws everything into chaos. It’s more than frustrating. It costs you money. Sometimes a lot of it.
If you’re dealing with this right now, you’ve got options under Pennsylvania law.
Recognize What Constitutes A Breach
Not every problem is technically a breach. I know that sounds like lawyer talk, but it matters.
A breach happens when one party fails to perform their obligations as outlined in the contract, and they don’t have a valid legal excuse. Maybe your vendor delivered products three weeks late when time was essential. Maybe the quality of their work is nowhere near what the contract specified. Or maybe they just never showed up at all.
Material breaches are the serious ones. These go to the heart of what you contracted for and substantially defeat the whole purpose of the agreement. Minor breaches are still breaches, don’t get me wrong, but they might not justify you walking away from the contract. You could still recover damages for what went wrong.
Document Everything Immediately
The moment you realize something’s off, start gathering evidence.
Everything matters. The original contract, obviously. Purchase orders, delivery schedules, emails, text messages, and any kind of correspondence showing what was promised versus what actually happened. If you received defective products, take photos. If work wasn’t completed, document that too. Build a timeline that shows when the vendor was supposed to perform and when they actually did or didn’t.
This documentation does three things for you. First, it helps you see the full picture of what went wrong. Second, if you end up in court or arbitration, this is your evidence. Third, it shows you tried to handle this professionally, which judges and arbitrators appreciate.
Review Your Contract Terms
You’re looking for provisions about what happens when someone breaches. Notice requirements are common, meaning you have to notify the vendor in a specific way before taking legal action. Many contracts include cure periods that give the breaching party time to fix what they messed up. You’ll also want to find any limitation of liability clauses because those might cap how much you can recover.
Dispute resolution procedures are in there, too. Your contract might require you to try mediation or arbitration before you can file a lawsuit. And there should be something about termination rights and what penalties apply if someone ends the relationship early.
Communicate The Problem In Writing
Be specific. Tell them exactly what they failed to do and point to the contract provisions they violated. State clearly what you want them to do about it. But keep your emotions out of it. Stay factual. Professional. No threats at this stage.
Give them a reasonable deadline to respond and fix the problem if that’s still possible. Sometimes this actually works, and you resolve everything without lawyers getting involved. Even if it doesn’t work, you’ve created a paper trail showing you tried to work it out.
Calculate Your Damages
Start adding things up as soon as you can. Having a specific total of monetary damages helps strengthen your case and can be used in negotiations to your advantage. What’s the difference between what you paid the vendor and what you had to pay someone else to get the work done right? Did you lose profits because you couldn’t deliver to your own customers on time? What did it cost you to scramble and find a replacement vendor? What about expenses you wouldn’t have had if they’d just done what they promised?
A Scranton business lawyer can help you identify damages you might not have thought of and figure out what evidence you’ll need to prove them.
Consider Your Remedies
Fortunately, Pennsylvania laws provide business owners with many avenues to a solution. Monetary damages are the most common. You’re asking to be compensated for your losses. Sometimes you can ask for specific performance, which means a court orders the vendor to actually do what they contracted to do instead of just paying you money. Or you might have the right to terminate the contract completely and move on to a different supplier.
What’s best depends on your situation. If this were a one-time screwup and the vendor relationship is generally valuable to your business, maybe you negotiate a solution and move forward. But if they caused serious harm or they’re showing you they don’t care about making it right, you might need to take stronger action.
Explore Alternative Dispute Resolution
Litigation takes forever and costs a fortune.
Mediation and arbitration resolve things faster and cheaply. A lot of commercial contracts actually require you to try one of these approaches before you can sue. But even when they don’t require it, these options make sense.
Mediation brings in a neutral third party who helps both sides reach an agreement. It’s voluntary and collaborative. Arbitration is more formal. An arbitrator hears evidence from both sides and makes a binding decision. Both are usually faster than court, less expensive, and they keep the details of your dispute private instead of creating a public record.
Protect Your Business Going Forward
At Hoegen & Associates, P.C., we work with Pennsylvania businesses dealing with vendor breaches. Sometimes that means reviewing your options and helping you understand what’s realistic. Sometimes it means negotiating on your behalf. And sometimes it means pursuing legal remedies through arbitration or court.
Having someone who knows what they’re doing can change the outcome significantly. A Scranton business lawyer can look at your specific situation, your contract, and your damages and help you figure out the smartest path forward. Reach out to our team to talk about what’s happening with your vendor and what makes the most sense for your business.