Conflicts of interest are common in every business; the main question is how you deal with them.
A business dispute is a conflict or disagreement between two or more parties over a business matter.
These disputes can include contractual breaches, shareholder conflicts and issues with suppliers. If you find yourself in the middle of a dispute, here are some of the steps to take:
Understand the dispute
The first thing to do is figure out the root of the problem, starting with clear questions: What’s the problem, and why is it an issue? Is it contractual or financial? You need to understand the problem before you can start planning your approach.
Communicate openly
Regardless of how stressful the situation may be, it’s important to remain calm. Keeping a clear line of communication is vital to resolve a dispute amicably. Open and honest dialogue can help to avoid any misunderstandings.
Reach a solution
After you have considered all the facts and both parties have communicated their views, it’s time to find a solution. This likely won’t be straightforward and both parties will need to compromise.
Alternative Dispute Resolutions (ADR) are ways to resolve disputes without going to court. Common forms of ADR include negotiation, mediation, adjudication and arbitration:
Negotiation – Parties will talk directly in hopes of reaching a solution themselves. The process doesn’t involve the use of any third parties. This often requires a willingness to compromise from at least one party.
Mediation – This step involves the use of a neutral third party to act as a mediator for both parties. The mediator does not make any decisions but helps to maintain communication between all parties.
Adjudication – This is the process where a judge resolves an issue between two parties. The judge is a neutral third party that reviews all evidence and makes a binding decision. Unlike litigation, adjudication is less costly, less formal, and faster.
Arbitration – This involves an arbitrator, a neutral third party, making a binding decision. The arbitrator takes both side’s views into account at a hearing before deciding. The decision the arbitrator makes is legally enforceable.
Litigation is the process of taking legal action.
If you have tried the previous steps to no avail, you may have to consider litigation. It’s vital to get legal advice before proceeding with litigation. Consulting a lawyer is imperative to ensure that you understand all the risks involved.
Do bear in mind, that the legal process can be costly and stretch over a long time, we are talking years. Unfortunately, if other options have been explored and a resolution has not been found, this may be your only remaining option.
Future Mitigation
After you have resolved your dispute, it’s important to ensure that you don’t face a similar situation again. Reviewing your practises and ensuring that all contracts are clear can minimise the risks of future disputes. Treat the dispute as an opportunity to learn so it doesn’t happen again.
As mentioned above, if you are in a dispute and have exhausted all other methods, please contact us. At Lawhaven Law Firm we give expert legal advice in resolving business disputes. Your first consultation is free!