This article is also available in Polish.

As we have described in previous articles in our Legal Snapshots series, it is advisable, even before entering into a contract, to apply measures that will reduce the risk of a potential dispute. In particular, it is recommended to ensure that the counterparty is adequately verified, the obligations and rights of the parties are precisely defined, and that appropriate securities are introduced into the contract. Of course, the application of such measures does not entirely exclude the possibility that a dispute may arise between the parties at the contract performance stage.

Consequently, you should remember to adequately document the correct performance of your obligations or the incorrect contract performance of your counterparty. Similarly, one should be careful when making any statements or declarations. Often these actions can have a significant impact on how the case will be resolved in court or what settlement can be negotiated.

Security of potential evidence and adequate documentation of activities during contract performance

In the course of litigation, the chances of obtaining a favorable outcome depend to a significant extent on what evidence a party is able to present in support of its claims.

Court proceedings often take place some time after the events giving rise to the dispute. For this reason, it can be difficult to collect evidence in the course of legal proceedings (and sometimes even at the time when the dispute between the parties has already arisen), e.g., from the initial stage of cooperation extending over several years. Therefore, it is important to keep an up-to-date record of the project (event/agreement), e.g., in a binder or virtual file folder prepared for this purpose.

Substantial agreements between the parties should be recorded in the form of an email or in writing so that they can be effectively proven in the event of a dispute. This is particularly important in B2B relationships, as in commercial disputes documentary evidence is of the greatest importance to the court. It should also be borne in mind that a specific form is sometimes required for certain effects of an action (e.g., it may not be sufficient to amend an agreement by e-mail if a written form is reserved for such amendment on pain of nullity).

The need to keep adequate records applies both to circumstances relating to your own performance of the contract and those relating to the other party's improper performance of the contract. For this reason, it is advisable to ensure that the documentation collected should include such documents as acceptance or handover reports (which may include photographs instead of a descriptive section), key e-mail correspondence, proofs of delivery of invoices, contract performance reports and relevant technical documentation (Including, e.g., documentation on how the product should be maintained).

In addition, as a result of the time lapse between contracting and litigation proceedings, witnesses may not remember important details at the time the cause of action occurred, or it may be difficult to contact witnesses who have changed jobs in the meantime. For this reason, it is good practice for staff to take notes of any key conversations with contractors. Such notes, once signed by the employee, should be filed in the documentation you keep for the project. The notes are then very helpful to both the party itself in analysing the case if a dispute arises and to the court, which can receive a document with the first pleading that gives credence to the relevant claims.

Long and fruitful cooperation between the parties should not be an invitation to complacency either in recording the performance of the contract. A possible dispute may arise even in a relationship with the best contractor. Furthermore, it is advisable to keep such documentation not only for the duration of the contract but also for the entire limitation period. In the case of contracts between entrepreneurs, the limitation period is typically three years and ends on the last day of the calendar year.

Careful statements

Of course, the parties exchange numerous statements and declarations during contract performance.  However, when corresponding with the other party, it should be kept in mind that the counterparty may, in the event of a dispute, attempt to use such correspondence, e.g., to imply additional contractual rights or obligations.

Being cautious about your correspondence becomes particularly important at the stage when you foresee that a case is likely to become contentious or is already so. It is then advisable to carry out a legal analysis of the case in terms of risks or opportunities for you. The results of such an analysis allow you to better prepare your letters at the pre-litigation stage. If the case eventually goes to court, the party's arguments at the pre-litigation and court stage will be consistent and thus more credible.

If you are interested in further details on how to properly record the performance of contracts or make representations in respect of concluded agreements, the experts at TaylorWessing will be happy to advise you. 

Jak udokumentować, że prawidłowo wykonuję umowę (lub że kontrahent wykonuje ją nieprawidłowo)?

Jak opisywaliśmy we wcześniejszych artykułach z serii Legal Snapshots, jeszcze przed zawarciem umowy warto stosować środki, które zmniejszą ryzyko powstania ewentualnego sporu. W szczególności warto zadbać o stosowną weryfikację kontrahenta, czy też precyzyjne określenie obowiązków i uprawnień stron oraz wprowadzenie do umowy odpowiednich zabezpieczeń. Oczywiście stosowanie takich środków nie wyłącza całkowicie możliwości powstania między stronami sporu na etapie wykonywania umowy.

Wobec tego należy również pamiętać o odpowiednim dokumentowaniu prawidłowego wykonywania swoich zobowiązań lub nieprawidłowego wykonywania zobowiązań przez kontrahenta. Podobnie należy być ostrożnym przy składaniu jakichkolwiek oświadczeń lub deklaracji. Często czynności te potrafią zaważyć na tym, w jaki sposób sprawa zostanie rozstrzygnięta przez sąd lub jaką ugodę uda się wynegocjować.

Zabezpieczanie potencjalnych dowodów i odpowiednie dokumentowanie czynności w trakcie wykonywania umowy