Top Ten Tips
Jonathan Mortimer, head of dispute resolution at Langleys solicitors, offers his top ten tips on avoiding a legal dispute in an economic downturn.
BUSINESSES are facing turbulent times and with the situation predicted to continue, it’s vital that they look at ways to avoid uncertainty and unnecessary legal issues – whether it is a former employee taking business from a competitor, struggling to obtain payment from clients, or being tied up in legal disputes.
We have identified ten key rules to follow in order to avoid a legal dispute:
1. Incorporate your terms and conditions into your trading arrangement
Remember that terms and conditions put you in the driving seat. Whenever we deal with a dispute as to the supply of goods and services, we will ask straight away about your terms and conditions. Most clients have terms and conditions which will assist with a dispute. However, many fall at the first hurdle by putting them on the back of invoices, or by not bringing them to the attention of the customer, before the sale or service is agreed. As a result, instead of discussing how your terms and conditions may assist you to defeat the claim, you could be side-tracked by having to justify why the terms should apply at all.
2: Confirm agreements in writing
Avoid your word against theirs. This is simplistic, but the reality is that a high percentage of our cases still involve disputes about oral arrangements. Oral agreements are just as enforceable as written contracts, but it is a case of proving them. It’s important that you confirm what was agreed in writing and ask your client or customer to acknowledge what you have written. A detailed purchase order can also help.
3: Involve other managers when entering contracts
Again this avoids their word against yours scenarios. Ensure that key terms and requirements are discussed internally, and then in the presence of your customer, to ensure there is no possible misunderstanding.
4: Make your requirements clear
Too many businesses presume that their supplier understands what they want when ordering goods or services. As a result we deal with numerous claims arising from the specification of any particular product or service. So make your requirements clear, by providing a list of requirements, or specification, before the deal is agreed.
5: If something goes wrong put it down in writing immediately
The starting point for this rule is that the Court is inundated with spurious defences to claims. As a result, the Court can be cynical as to the merits of any defence put forward. Consequently, you improve your credibility by rehearsing a problem in writing as it happens. Raising a complaint when proceedings have already been issued will look weak and could prejudice the case.
6: Retain access to electronic communications
Again here we are talking about avoiding a dispute, or at least improving your chances of success, by having the evidence to prove your case. In many matters, what is said electronically is now more important that the hard communications. We have seen cases being lost, because clients have not had a proper method of storing electronic documents, or have even changed computer systems and not retained copies of key documents. Checking your storage systems is crucial – remember that claims can be brought up to 12 years from the event, or facts relied upon.
7: Watch your e-mails
Emails are just as important as letters. The speed and quantity at which e-mails can flow out and into any business is quite frightening. E-mails are indeed just as important as letters and you can make contracts by e-mail, vary terms, or even cancel an agreement by e-mail. The same care is therefore needed when putting together e-mails, as with more formal correspondence.
Do not forget to check e-mails – a customer could quite easily cancel an order without you having spotted the communication, because it is caught up with unread messages, or even mot been received at all because of your spam filter. Consider putting on your bounce back to make it clear that you are out of the office and not able to accept messages, so that your customer is put on notice that they need to communicate in a different way. If necessary, consider changes to your terms and conditions to make it clear that orders or amendments cannot be made by e-mail and must be confirmed in hard form.
8: Keep your website up to date and compliant
Again with the advance of technology what we say electronically is fundamental. Too many websites are out of date or fail to protect your position. Representations made on a website can be just as binding upon you as a hard brochure, or other piece of literature. Consider whether your website should have a disclaimer, or contain terms and conditions, particularly if on-line ordering is a possibility.
9: Watch your correspondence
Watch what you say when you believe a dispute is likely. We deal with too many cases in which clients have prejudiced their position in the early stages by saying the wrong thing. Perhaps by innocently making an admission, such as stating that you accept that the order was not what it should have been, when in fact the order was well within the standard of service allowed in your terms and conditions.
10: Take legal advice sooner rather than later – anything else can be a false economy
You would expect a lawyer to say that – but this point is perhaps the most important. The law is complex in itself and not being familiar with how to apply what law you know procedurally in the Court, is even more taxing. We come across many cases in which litigants in person do not have a clue what they are doing. In the seventeen years I have been doing this job, I have only lost once against a litigant in person and the Court statistics indicate a very low percentage success rate for non-lawyers as well. Yet I still come across clients battling on their own and then approaching me when it has all gone wrong – and frequently it is too late. So for the sake of an initial consultation for a fixed fee, or even a quick free call, do take legal advice as soon as you can.
