5 Ways To Avoid Business Disputes

Whether you are a well-established large business, a small business, or somewhere in between, sooner or later your company is likely to enter some form of legal dispute. However, this is not inevitable, and many commercial disputes can be prevented easily. 

Avoiding business disputes can save you and your business valuable time, money, and avoid damaging your business’s reputation. 

Research EVERY New Opportunity 

It can seem unimportant to conduct research when a new exciting business opportunity presents itself, whether this is a new employee, business partnership or something else. 

It is vital to complete background research on every opportunity to avoid a business dispute. Entering into an agreement without knowing anything about the people and their values can leave you vulnerable.  

Research will be dependent on the situation; however, you may want to use Companies House, professional registries, and even Google reviews! For prospective employees, viewing their professional accounts such as their LinkedIn profile can often be a good indication of their working values and their personality. 

Document EVERYTHING 

This is one of the easiest and best ways to avoid commercial business disputes. If you have solid documented data to refer to then you can resolve disagreements quicker and discourage long disputes/legal actions.  

Similarly, you should avoid making agreements off-the-record or likewise undocumented deals. All business matters should be recorded carefully, here is a list of some important items that you should keep track of: 

• Contracts and agreements 
• Emails 
• Proof of payment documents 
• Minutes from meetings 
• Accounting information 
• Calendars 

Be SPECIFIC with Your Contracts 

No matter your business or industry, you will find yourself creating and entering into contracts with all sorts of people, from employees to suppliers and more. These need to be as specific, well-constructed and precise as possible to minimise your legal liability. 

To be more specific, your contracts may be centred around: 

• Responsibilities 
• Rights 
• Performance 
• Termination 
• Quality of service/work 

In particular, you should look to detail termination requirements and have contingencies in place regarding the acceptance of services. Being specific with these areas could allow you to exit a contract without forming a dispute. 

Creating commercial contracts is not something that should be taken lightly, it is certainly not a copy and paste job! A legal professional should always be instructed, click here to find out how I can help with your commercial contracts. 

COMMUNICATE Clearly 

Often, business disputes can be avoided if you communicate clearly with the other party. If you actively work on your communication channels to resolve issues from the beginning and do not avoid prominent issues, then you are more likely to build trust. 

Do not overestimate your abilities and if you find yourself unable to deliver on the agreed terms then communicate that promptly and clearly. This should be backed up by internal policies regarding communication practices to ensure there is no confusion. 

If you are dealing with another business that are not delivering what they promised, then this should be communicated too. Communicate what is working, what isn’t and what can be done to rectify the issue. Do not wait for the other party to contact you first! 

Be PREPARED to try alternative dispute resolution 

If all else fails and you are on the brink of going to court over a commercial dispute, then you should be prepared to try an alternative dispute resolution (ADR) for commercial dispute resolution which is a way to settle a dispute without going to court. This is when the parties may be able to compromise and find a settlement that allows them to avoid court. 

There are multiple types of ADR depending on your situation including arbitration, mediation or a face-to-face meeting. These different types are often used depending on the form of relationship between parties and if there is high tension. 

ADR is cheaper, quicker and can even allow your commercial relationship to continue afterwards. This is the best outcome of any business dispute! 

All business disputes are important for your business to deal with properly, no dispute is too small to get legal advice for. Ensure your business is properly protected from business disputes and well equipped to avoid them. 

Just Ask Harry now for any commercial contract advice, including if you are suffering a business dispute due to another party.