insideKENT Magazine Issue 34 - January 2015 | Page 136

LAW

DISPUTES: HOW TO
STOP THEM
RUINING YOUR LIFE
For individuals and businesses, a dispute can be both
time-consuming and expensive. Whether the
disagreement is with a customer or supplier, a friend
or family member, a property owner or a professional
advisor, without careful planning, claims can quickly
escalate, often putting at risk your financial security or
that of your business.
Disputes do, however, arise and they can be approached
in ways that reduce the time and cost implications and,
as a consequence, the risks. Philip Youdan, a specialist
disputes expert at Cripps, explains how.
Phil Youdan

1. If you cannot avoid them, anticipate them
Many of our clients operate businesses where disputes can and do arise.
We help them minimise the risk both of a claim arising and of that claim
escalating through careful drafting of, for example, terms of business
between a supplier and a customer.
The absence of a well-drafted agreement greatly increases the scope
for dispute but also makes any dispute dependent upon oral evidence,
which is flavoured by each side’s point of view.
It's not just businesses that benefit from putting agreements in writing.
Individuals, for example friends starting up a project together or a couple
purchasing a home, often assume that due to their relationship, a formal
document is unnecessary. This is a mistake; it's not uncommon for people
to have a difference of opinion, and even small differences can become
magnified over time. Without a written agreement to fall back on, these
small differences can cause the relationship to fall apart.

However, whilst there are exceptions, generally an early settlement,
through either written correspondence or a meeting, will give rise to the
best result. One reason for this is that before a trial, legal and other costs
have been incurred, and these can be a barrier to reaching a settlement,
as someone needs to pay these.
Alternative forms of dispute resolution should be considered, such
as mediation, which can help achieve early settlement. This is invariably
more cost-effective than litigation and is often a good option where the
relationship between the parties needs to be preserved.
4. Give and receive clear guidance on costs
Of course, some disputes cannot be settled. In these cases, however, it
is vital that you have at the outset a clear conversation with your advisor
about the value of the claim to you or your business, what you can afford
to spend on the legal costs, and what would be the impact of the claim
failing.
A strategy for dealing with the litigation can be prepared, which will
include an understanding of who will do what work and at what cost.
It is not uncommon, for example, for a client of ours to agree to take
responsibility for elements of the preparation work (which we then review)
in order to ensure the overall cost fits in with the budget agreed at the
outset.

2. Avoid false economies – get advice at an early stage
In many instances, people will not approach a solicitor for advice until the
dispute has become too difficult for them to manage, because either the
value has grown or a degree of animosity has set in.
It is much better to get advice right at the start. This does not need
to mean formally instructing a solicitor to represent you and write letters on
your behalf. In many instances, this is not the right approach.
Instead, the legal advice should be practical, focusing on how to
resolve the disagreement before it escalates. This will take into account the
legal merits of your position, but this is only one of the factors to be
considered.
Getting early advice is normally less costly than waiting until the dispute
has grown or until Court proceedings are issued and getting advice at that
stage.
Another advantage of getting advice at the outset is that you can get
guidance on the kind of evidence that you shou