Commercial disputes are part and parcel of being in business. Most disputes can be resolved quickly without the intervention of lawyers, however there are instances where legal intervention is required, including Court proceedings.
It is often the same issues that cause disputes to erupt and costs to blow out in litigation.
Below are some tips that can help your business either avoid disputes altogether, or if Court proceedings are inevitable, minimise the issues and importantly substantially reduce the costs you are likely to incur:
#1 – Clear and Concise Agreements in Writing
Many clients come to us with an “agreement” comprising of snippets of paper, emails and conversations. Whilst all of these things can comprise a binding agreement, if the terms of an agreement are contained in writing in one concise document, a party’s rights can be easily established. This can avoid a dispute in the first instance, or limit the issues in a Court case thereby limiting costs.
Sometimes clients are reluctant to spend money with lawyers to draft an agreement. Parties are getting along splendidly and do not see the need to properly document their business agreement. Then suddenly the relationship deteriorates. The costs of a Court case with an uncertain agreement can be ten times greater than the costs of a lawyer drafting an agreement in the first instance.
#2 – Good Record Keeping
This makes it easy to prove that something happened. An easy tip is to follow up conversations with an email. This also avoids uncertainty.
#3 – Good bookkeeping
It is far easier to prove a debt is owed or you have paid amounts owing if you have good book keeping records.
It is also much cheaper than handing your lawyer a bag of invoices and receipts.
#4 – Up to date Terms and Conditions
T&C’s should be reviewed and updated regularly, to consider whether your terms are still relevant to your business.
Do you know which version of your T&C’s applies to each of your customers?
Do you need to update the company/business details?
#5 – Don’t stick your head in the sand!
Acting quickly and resolving disputes early on generally leads to a quicker and cheaper resolution. Damage to business relationships can quickly be repaired, you can move on and focus on what you do best – your business!
Delayed disputes are often harder to resolve with parties entrenched in positions. A party who has been ignored is also less likely to negotiate.
Court proceedings and other documents such as Creditor’s Statutory Demands and notices from the ATO have deadlines, and if you don’t act promptly there will be dire consequences.