Firm foundations lead to better dispute resolution!

I don't know if it's the hot weather, making people more tetchy than usual, but we seem to have had a rush of Dispute Resolution requests recently. These range from simple ('we don't think we had a contract, so we're not going to pay you for your work'), to complex ('Yes, we have a contract but it's so convoluted that the only people who can say for sure what the situation is are the Courts.'), and with sums involved from thousands to millions of pounds.

In all cases, though, there are two common threads that might be useful to highlight.

Firstly, the party who is suffering through the dispute is not entirely clear as to what their legal position is.

In some cases, this is just because they are not experienced at reading contracts, and understanding the ramifications of the various elements of their situation - this is relatively easy to fix, and we have been able to offer assistance in gaining a clear idea of their rights. In others, though, the original commercial relationship was not set up on a firm footing. This means that either there was no contract at all, or the contract was too high-level to be of help, or the contract was complex, self-contradictory and unclear! This is far more challenging, as we are having to pull together lots of other information (how people have behaved, what they have said in emails, etc) to try to determine what the original agreement actually was. A much tougher job than just reading through a nice, clear contract!

The second common thread is that the party who is causing the dispute believes that just by refusing to pay what is owed, they will either avoid payment altogether or at least secure a discount on what they owe through a 'negotiated settlement'.

The outcome of the situation depends on the extent to which these two threads co-exist. The more contractual clarity there is, and the better the suffering party understands their position, the more likely they are to stick to their rights and eventually to agree a favourable result. When you are in an unclear contractual situation there is the tendency to settle for less than you should, simply because working through the detail looks too difficult and expensive.

At Devant, we will always try to establish clarity regardless of the complexity of the situations our clients find themselves in. And, of course, we work hard to obtain the best outcome for the client, which means the optimum balance of time and money invested in sorting things out versus the amount at stake. But it certainly makes life easier if the original commercial relationship was clearly defined! I guess it's the commercial equivilent of the old adage 'marry in haste, repent at leisure'. I prefer to put a more positive spin on things though - how about 'Contract with care, to avoid despair'? Or 'If your contract's cute, you'll avoid disputes'? Hmmm... maybe I should stick to writing contracts, and leave the slogans to the professionals!