Business Dispute Resolution Article
05 October, 2021
Disputes between businesses do sometimes arise and if all attempts to come to an agreement or compromise are unsuccessful, commercial litigation may be something that you wish to proceed with. This can be a complex area of law, and strict protocols must be followed, so this guide aims to outline the key stages that are likely to be involved in this type of legal action.
Commercial litigation is the legal action that may be taken if a dispute arises between two businesses that cannot be resolved by other means. Common types of dispute include contractual issues, disputed debts, director and shareholder disputes, partnership disputes, professional negligence, injunctions, property disputes or issues around intellectual property.
Commercial and corporate litigation can be costly, stressful and take a long time to resolve, which is why we usually recommend trying to find an agreement with the other party before reaching the stage of court proceedings.
If a dispute arises between your business and another, there is a pre-action process that needs to be followed before court action can be taken. This is to give the parties involved ample opportunity to resolve the problem before it reaches the stage of court proceedings.
The claimant will need to send a letter of claim to the defendant (usually done by your commercial litigation lawyer) which outlines the dispute as they see it, how this contravenes the law and what they wish the outcome to be. The defendant then has an opportunity to respond to this letter and give their own thoughts on the matter. They may wish to concede the claim at this point, or they may choose to defend their position.
Both parties may choose to enter voluntarily into an alternative dispute resolution process at this stage, such as mediation, which may help to bring the matter to a settlement that both sides agree to before court involvement is needed.
A court claim cannot be issued until the pre-action stage has attempted to resolve the dispute in some or all of the ways outlined above, depending on the circumstances involved.
The next stage is for the claim to be issued at court, by means of filing a Claim Form and paying the required court fee. There will also be a document outlining the dispute called 'Particulars of Claim' which will provide the background details and context to the claim to the court as well.
The defendant will then have a deadline within which to formally respond to the claim in writing with a defence.
Depending on the complexity of the case, it could some time before the actual trial court date. The stages of commercial litigation before trial include costs budgeting, disclosure of relevant documents which the parties want to rely on, witness evidence and depending on the type of claim expert evidence as well.
With the disclosure of evidence by both parties, it gives both sides another opportunity to assess the strength of the other's case, which can help ultimately reduce costs if this results in an early settlement. The evidence could be in the form of electronic communications as well as paper documents, depending on the specifics of the case. In complex disputes, this could involve hundreds or even thousands of documents, which is one reason why this stage of the process can take a long time to complete.
The evidence required from factual witnesses, expert witnesses or both, depends on the nature of the dispute Evidence will be presented by way of written statements to form part of the body of evidence that needs to be disclosed and reviewed by the court.
There is usually also a series of court hearings before trial which deal with the management of the claim at court and the timetable for the various stages to be undertook. These court hearings are called Case Management Conferences, Directions hearings and Pre-trial Reviews.
Most commercial litigation cases settle before they ever reach this stage, as trials come with significant costs and extensive preparation and time investment is required. However, for the disputes that cannot be resolved by any other means, there may need to be trial so that the issue can be determined by the court.
The length of the trial will depend on the complexity of the case and could range from a single day to several months, especially if there are several witnesses to hear from, as well as extensive document evidence to consider.
Once the trial has concluded, the judge will consider the evidence, statements and submissions and will then give their judgement on proceedings. This could take several months for complicated cases.
The decision of the judge is final, although can sometimes be appealed in certain limited circumstances.
The party that loses the case is ordered to pay the damages that the judge awards to the successful party, and this can be enforced if payment is not received according to the terms outlined at this stage. The legal fees of the successful party may also need to be paid by the other party, depending on the costs involved and any previous agreements in relation to this.
Sometimes the decision of the judge at trial can be appealed if the evidence or law has not been properly applies to the facts of the case. Permission to appeals a trial judgment is needed and appeals must be commenced soon after the final judgment.
This guide aims to give a top-line view on the standard process for making a claim against another business, but there may be some variations, depending on the circumstances involved in your situation. Your commercial litigation solicitors should keep you fully informed at every stage and let you know what to expect next at all times.
If you want any more information, our team of commercial litigation specialists can help. Get in touch by calling 0800 689 0831.
For more information contact Michael Chambers in our Business Dispute Resolution department via email or phone on 0333 207 0740. Alternatively send any question through to Forbes Solicitors via our online Contact Form.
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