Top Tips for Reducing Risk in Disputes
Although all businesses will hope not to need to become involved in disputes with their contract counterparties, sometimes there is no other option.
Getting some of the basics right from the outset, particularly in terms of dispute strategy, will help to maximise the chances of a successful outcome. We look here are some tips when considering your approach to a potential dispute.
- Grasp the Nettle
Potential issues caught early on stand a better chance of being found a simple amicable outcome. Delay can also lead to you losing rights. - What do You Want?
Have an aim, but be prepared to rethink e.g. if new evidence comes to light. If you want to terminate an agreement, check that you can lawfully do so before taking any steps. - Beware of Deadlines
You normally have 6 years to start a claim for breach of contract. However, something else may have been agreed in the contract e.g. having to notify the other side of a claim within a much shorter period. Other shorter deadlines may apply too: such as in procurement disputes. Failing to meet these criteria may kill your claim. - Be Careful with Documents
Once litigation is contemplated, there is a duty to preserve evidence. You will also want to keep things safe to best support your arguments. Equally, beware of creating new documents as you may be obliged to disclose those during the litigation process.
- Think About Witnesses
Who will they be; will they be able and willing to assist? Is expert evidence needed and if so, when? - Is It Worth It?
Don’t get drawn in: is it worth the time and effort? Court litigation may be too costly: other options are available. - Follow Up in Writing
'It's good to talk' to get to the bottom of a problem with the 'other side'. But it will often be helpful to follow up in writing to have evidence of what was said. - Consider the Process
The contract may contain a mandatory dispute resolution process. These typically include escalation, litigation, arbitration, mediation and expert determination: each of which involves a specific procedure. Each method comes with strategic pros and cons. - Insurer and Regulator
If the dispute is covered by insurance, most require you to tell the insurer when you “become aware of circumstances which could reasonably give rise to a claim”. Check if you are also required to report the issue to your regulator.