Ella says: “All parties within any litigation have an obligation to attempt to settle before the need of court intervention.
“The court encourages parties to participate in a form of ADR to settle their dispute before any court proceedings are issued, potentially saving time and costs.”
A landmark Court of Appeal judgement last November also established that the courts can order parties to mediate or engage in some other form of ADR.
Commenting on that landmark decision James South, chief executive of the Centre for Effective Dispute Resolution (CEDR), says: “We will now enter a new era of positive change.
“When justice is looked at from the perspective of the disputants, they want their dispute resolved in a cost-effective and fair way, ensuring they have the opportunity to be heard, and that resolution meets their commercial and personal needs.
“Mediation can provide this, and this judgment gives the courts the tools to actively encourage settlement by allowing courts for the first time to order parties to mediate, if in their discretion they consider it reasonable to do so.”
There are around 17,000 mediations carried out annually with roughly £20bn of cases going through the process.
Since 1990 around £195bn worth of Expert View
ESCALATING A BUSINESS DISPUTE
By Ella Holden, solicitor in Farleys’ insolvency and litigation team
Sometimes business disputes can reach an effective outcome that suits all parties through direct negotiation without the need to get a solicitor involved.
However, when the value or complexity of a dispute becomes too much to be managed this way, you may want to consider instructing an experienced solicitor to assist.
Making initial contact with a solicitor about your dispute will allow you to get expert guidance on your claim and advice on your next steps.
A solicitor can help you pursue your claim through a pre-action protocol letter, sent to the other party to the dispute, setting out the summary of facts, basis of the claim and the desired outcome.
If your claim proceeds to court, a solicitor will help to prepare your claim and achieve the best possible outcome for you.
However, not all business disputes have to reach court. Alternative Dispute
Resolution (ADR) is a form of resolution that avoids the need to go to court.
All parties within any litigation have an obligation to attempt to settle before the need of court intervention.
The court encourages parties to participate in a form of ADR to settle their dispute before any court proceedings are issued, potentially saving time and costs. Forms of ADR include:
• Mediation – negotiation assisted by an independent third party
• Arbitration – a formal process which leads to a decision that is binding and enforceable on the parties
• Adjudication – a third party provides a decision on the dispute which is usually binding pending a reference to the court for final determination
If ADR is unsuccessful and the dispute is not resolved, your solicitor may then advise issuing court proceedings to resolve the dispute.
cases have gone to mediation, saving business around £5.9bn a year in wasted management time, legal fees, lost productivity and damaged relationships.
Settlement rates remain impressive. CEDR figures show 73 per cent of cases are settled on the day with a further 20 per cent in the days and weeks following the engagement.
The Blackpool headquartered Federation of Small Businesses (FSB) warns that, handled poorly, contractual disputes can be costly and time-consuming, ending up in court and damage business relationships and reputation.
It advises business leaders to work to find a resolution and points out that not going to court will avoid additional costs and time.
A spokesperson says: “Handling the dispute with care can help you avoid damaging existing business relationships and your reputation.
“The parties should try to look at things objectively and dispassionately. All contractual disputes can ultimately end up in court, but as a general rule this should, where possible, be seen as a last resort.”
They add: “Take advice as soon as a potential dispute arises. You need to know your legal position so that you can respond accordingly. Whilst you may feel that you are in the right, it’s always advisable to get an objective legal opinion.”
...but we believe the law should be
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LEGAL VIEW
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