What is commercial litigation and how are commercial disputes resolved?
What is commercial litigation and how are commercial disputes resolved?
Being in business can be a minefield, with many ups and downs. Unfortunately, conflicts and disagreements are relatively commonplace, and these are known as commercial disputes. This could be between two or more businesses, or even between the owners of the same business. In this article we look into the various types of business disputes, what commercial litigation is and how these commercial disputes can be resolved.
What is commercial litigation?
Commercial litigation is a type of civil litigation (as opposed to criminal) usually concerning legal disputes between commercial companies or individuals. Therefore, the nature of these disputes usually relates to business activities.
It is important to understand how different types of business disputes may arise and what it could mean for a business.
What are the most common types of commercial disputes?
- Contract disputes
Contract disputes are usually the most common in commercial litigation. Often, contractual disputes take the form of breach of contract claims where one party has failed to fulfil their obligations under a contract.
- Disputes with former employees
These types of employment disputes commonly arise between employers and former employees. These disputes could surround claims for wrongful termination, breach of employment contract obligations (commonly breaches of restrictive covenants), harassment and victimisation claims.
- Shareholder, director and partnership disputes
Shareholder, director and partnership disputes arise where there is a conflict between shareholders or directors. These types of commercial disputes stem from disagreements concerning the management of a company, the distribution of a company’s profits or directors’ duties.
- Debt disputes
Usually, commercial debt recovery disputes occur when a debt is owed to a business by another business or individual. These types of disputes usually arise from unpaid invoices or defaults on loan agreements and lead to commercial litigation.
How can we resolve a commercial dispute?
There are two main routes to resolving a business dispute.
One is commercial litigation. Commercial litigation is a way of resolving commercial disputes through the judicial system which ultimately leads to a judgment being made by a court which is binding on both parties. There are various stages when undergoing litigation proceedings which are governed by very strict procedural rules. In many instances in litigation, professional legal representation is necessary to ensure compliance with such rules.
The second is ADR (Alternative Dispute Resolution). This is an umbrella term used for methods such as mediation, arbitration, adjudication and negotiation which can be used to settle a dispute outside of litigation. These alternative methods allow parties to try and resolve disputes in a more collaborative, flexible and cost-effective way. Alternative Dispute Resolution methods can be less adversarial as opposed to commercial litigation.
In many ways, ADR is used more frequently and particularly in circumstances where litigation proceedings are on foot and are used as a means to try and settle a dispute without having to run the litigation to the very end (e.g. to trial/final hearing for determination). The UK courts also encourage parties to use Alternative Dispute Resolution, and where it is clear parties have failed to consider ADR as a means of settling their dispute, this could result in adverse costs orders made by the court.
How can GA Solicitors’ Business Disputes team help?
GA Solicitors’ commercial litigation, or business disputes team, is ranked in The Legal 500 and can offer effective legal advice across a wide range of commercial disputes. Skilled in both mediation and in court, the team can offer clear legal advice, but with a strong commercial understanding, advising you with both your business and your objectives in mind.
We can provide advice on:
- Contract disputes and disputes between businesses
- Professional negligence
- Shareholder/director/partnership disputes
- Enforcement of restrictive covenants
- Franchise disputes
- Builder and construction disputes
- Disputes regarding the sale/purchase of businesses
- Disputes with former employees
- Residential landlord and tenant issues
- Judicial review
You can read a recent alternative dispute resolution case study here.
If you would like to speak about a potential dispute, you can call our commercial litigation solicitors in Plymouth on 01752 203500 or email me directly via laura.keith@GAsolicitors.com for a no obligation discussion to see how we can help.
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