Commercial disputes are common – and, as your business grows, it's likely that you'll run into a dispute with a competitor, supplier, customer, employee or even a business partner.
However, some legal disputes can take significant time and resources away from a business – particularly where the dispute leads to litigation. Litigation is the process of dealing with a dispute in a court or tribunal. Other ways of dealing with disputes include negotiation to reach a commercial settlement, "alternative dispute resolution" (including mediation, conciliation and arbitration) and "external dispute resolution" (such as ombudsman services). Some businesses also use "internal dispute resolution" procedures, like a customer complaints process for an online retailer.
1Litigation is the process of seeking a judgment by a court or tribunal in relation to a dispute. Most commercial disputes do not result in litigation. But if you do find your business involved in litigation, it's vital that you work with an experienced solicitor who understands the process. In some cases, you may also need the assistance of a barrister. A barrister is a lawyer who specialises in litigation. Your solicitor will be able to recommend whether you should engage a barrister.
2Litigation starts when one party files an "initiating process" or "statement of claim", which is a document that outlines the case of the party bringing the dispute to court (usually known as the "plaintiff" or "applicant"). The other party (the "defendant" or "respondent") will then file a "defence".
3It is common for parties involved in litigation to attend mediation before their dispute is heard by a court. Reaching a settlement during mediation can help reduce time and effort spent in a more protracted court process.
4Remember that litigation is not necessarily about winning, but about getting the best result – bearing in mind the strengths of your case and the legal costs. Work with a pragmatic lawyer who understands these realities.
5Apart from litigation, other options for resolving a commercial dispute include negotiation, alternative dispute resolution, external dispute resolution and internal dispute resolution.