Legal Briefing

Speed of thought and action – the key to dispute resolution

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Disputes | 02 October 2018

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It may surprise some that raising and running court actions to a conclusion before a judge is only part of the overall picture in most large dispute teams. Dispute resolution is an area which covers many topics – at Brodies alone, more than 130 people work on delivering solutions for a diverse client base.

Indeed some might say that the range of fora available to clients is a good thing given the strain on the public purse. Without having to go into too much detail on why that should be, clients with any direct experience of the court system often cite that it can take too long to reach the end of the process. It may seem trite to say so, but clients want speed of thought and action to guide them through any court process or mandate as quickly as possible. The issue that all litigators then grapple with is getting things done as quickly as possible in a system that has rules and judges with only so many hours in the day to deal with the volume of business coming through their portals.

On the other hand, the UK courts do offer many clients what they are looking for. Urgent applications and remedies can be available to protect client interests pending a final determination. It should also be noted that the rule of law in the UK, taken for granted perhaps by some, is something we can be proud of. Notwithstanding litigation risk the application of the law, with precedents and skilful advocacy applied to a particular set of facts, should allow some real and meaningful advice to be given to clients. In our experience, that is a pre-requisite to meet any client’s expectations. Supporting clients with business critical disputes and/or important points of principle to prove in court can extend across a wide range of areas and for various purposes from, to name but a few examples, Brexit-related matters to insolvency situations and shareholder disputes. Listening to clients has led us to offer them greater choice and flexibility through the opportunity to instruct a team of solicitor advocates (solicitors with higher rights of audience), including three partners, one of whom is a QC, when embarking on court battles.

That being said, many commercial clients avoid the court system entirely by taking control of how they want disputes resolved in their contractual arrangements. For example in the energy sector, and in particular with oil and gas clients, the parties have long written into their contracts various guises of mandatory dispute resolution clauses, often with English law governing, which ensure that their disputes can be taken out of the public court system. Clients often take their pick from the suite of alternative dispute resolution (ADR) processes to fit with the types of contract they are entering. Although by no means an exhaustive list, we are frequently involved in advising clients during contract formation on dispute clauses that include escalation procedures, expert determination, mediation and arbitration. It is therefore important to clients that experience there can be called upon. In particular, we have found that clients are just as likely to end up with matters being resolved under contracts with provision for international arbitration under LCIA or ICC rules than through domestic arbitration.

Another growth area for dispute lawyers and clients to grapple with is investigations and dealing with regulators across a wide spectrum of issues. One of Brodies’ experts in this area, Paul Marshall, regularly advises on regulatory and white-collar crime matters ranging from bribery and corruption to the ramifications for businesses of legislation dealing with modern slavery and supply chain fraud. Whether in the financial services or energy sectors, there has been no bonfire of regulations – far from it, legislation and regulations can be expected to increase. Prosecutions can be avoided and reputational risk managed by employing people that work well with the authorities. Clients clearly like that approach and want the right kind of lawyers that can find a way to work with decision makers in all sorts of organisations.

There has been no bonfire of regulations – far from it. Prosecutions can be avoided and reputational risk managed by employing people that work well with the authorities.

Finally on ADR, and consistent with the theme of dispute lawyers resolving issues away from the public gaze, it’s worth mentioning the construction industry, where there could well be something to learn and apply from the way in which some high value disputes are resolved. Adjudication has proven to be a quick and often intense process that can produce an outcome within the sorts of timescales that can make a difference for clients. There is no reason why parties to any commercial contract could not adopt adjudication – one of the underlying rationales for adjudication being, once upon a time, that it was thought it would allow the parties to an ongoing contract to deal with a thorny payment issue while at the same time allowing them to move on and retain their ongoing business relationship. Some IT contracts might benefit from that sort of approach or a sophisticated alternative version adapted for what can tend to be contracts where implementation will take some time to achieve.

To end where we began businesses will always, as a product of their day-to-day existence, face claims. Claims just happen, usually when you least expect it and, sometimes, regardless of the efforts made by a business to mitigate the possibility of a claim arising. Large and complex claims do still arise under the headings of health and safety, property damage and professional negligence. The insurance industry is well versed in dealing with them. While it is fair to say that claims can end up in court, experience in defending matters for a wide corporate client base tells us that the vast majority settle before a judge has to impose a decision. Ultimately, most clients still want to avoid disputes and they still want lawyers that can use expertise and judgement to reach a settlement that in turn gives them certainty.