Alex Rodriguez and Yankees headed for potential contract dispute

Sporting events such as baseball may be an enjoyable pastime for many New Yorkers. Baseball, however, is not immune to contract disputes. Understanding how to respond to a breach of contract can help better bring about a positive outcome for the parties involved.

A recent contract dispute between Alex Rodriguez and the Yankees may be coming to a head soon. Based on Rodriguez's 2007 contract with the team, Rodriguez may receive $6 million when he hits his 660th home run. He recently hit his 655th home run. The deal between the parties that would pay Rodriguez the bonus has been labeled a marketing deal because performance bonuses are not permitted in Major League Baseball (MLB) contracts, according to MLB contract rules.

The Yankees argue that because of the performance enhancing drug controversies Rodriguez has been involved in, the homerun milestone cannot be marketed. Rodriguez may argue that the bonuses were for the milestones themselves and not subject to the Yankees' decision to market his homerun history or decision not to do so. The two parties may negotiate a settlement but if they are unable to do so, the contract dispute will move to arbitration and involve the players' union and MLB.

In addition to prominent sports contracts, contract disputes can arise in a number of everyday ways. Contracts define many common relationships that businesses and individuals engage in on a daily basis. Because of the importance business contracts play in commerce, it is important that businesses and individuals understand the contract process and how to effectively respond to a contract dispute. Depending on the circumstances, contract disputes may be handled in different ways and the parties should be properly prepared to resolve the dispute through negotiation, litigation or other options as necessary.

Source: The New York Times, "For Alex Rodriguez, a Milestone Looms, and Perhaps a Dispute," David Waldstein, April 10, 2015

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