What are commercial disputes?

Commercial disputes are disputes between businesses and they can occur for a number of reasons. They often arise as the result of a breach of contract or the failure to pay for goods or services received.

How do you resolve a commercial dispute?

There are different ways to deal with a commercial dispute, including informal negotiation, mediation and commercial litigation but, as they say, compromise is the best and cheapest lawyer. That doesn’t mean to say that you should accept a damaging action, but workable solutions are likely to save time, money and reputation. You are also expected, under pre-action protocols, to use court as a last resort.

When can you take a commercial dispute to court?

Formal demands can be used where informal negotiations have failed. If negotiation does not produce an acceptable settlement between the parties, court proceedings can be considered alongside alternative dispute resolution methods such as arbitration or mediation.

Where the issue is a breach of contract, the value of the claim will determine the court ‘track’ to use:

Other specialist courts/tribunals may be suitable in certain cases, such as intellectual property, complex commercial disputes, technology or construction. Please be aware of Civil Procedure Rules that must be followed in the event of a claim.

You may also wish to serve a statutory demand as a creditor which, if left unpaid by the debtor, threatens bankruptcy or ‘winding-up’ of the debtor.

What are the remedies for breach of contract?

The key remedies available for breach of contract are damages, along with equitable remedies such as specific performance, injunctive relief, or rescission.

What are damages?

As a general rule, the breach of a condition allows the aggrieved party to terminate the contract and claim any losses through damages. Damages are a way of ensuring that a party can claim for any loss they’ve suffered as a result of a contract breach. They work to ensure that the injured party can return to the financial position that they would have been in had the contract been completed. However, not all damages can be recovered and, if the breach is significantly serious, it is possible to request to be discharged from the contract instead of or as well as claiming damages.

What are equitable remedies?

In some cases, damages are not enough to remedy a breach and alternative action is required. An order for specific performance can require a party to perform a positive contract obligation. An injunction can either be prohibitory (ordering that something must not be done) or mandatory (ordering that something must be done).

If the court decides that there has been misrepresentation, a mistake, duress or the contract was created under undue influence, it can order a rescission, which aims to place the parties in their pre-contractual positions rather than the position the parties would have had if the contract had been completed.

Is there a time limit to making a claim?

You must make a claim before the statutory limitation period has expired. Simple claims in contract or tort (except for personal injury actions) have a limitation date of six years. Where the claim relates to a validly executed deed, this is increased to 12 years.

Contact us for advice on avoiding and resolving commercial disputes. You can submit an enquiry using the form below, call us on 01392 256854 or email business@cartridgeslaw.co.uk.