Disputes are an inevitable part of commercial life. Left unchecked, they drain resources, damage reputations, and paralyse operations. In the UK, businesses have a range of legal tools to resolve disputes—from negotiation to litigation. The key lies in prevention, early intervention, and strategic resolution.

This guide explains common causes of business disputes, how to prevent them, and the most effective methods of resolution.

• Breach of contract: failure to supply goods/services.

• Partnership/shareholder disputes: disagreements over management, dividends, exits.

• Professional negligence: e.g., negligent accountants, surveyors, solicitors.

• Employment-related disputes: breach of restrictive covenants, confidentiality.

• Supply chain disputes: delivery delays, quality issues.

Prevention is always cheaper than cure. Key steps include:

• Drafting clear, robust contracts with express terms on payment, delivery, liability.

• Including dispute resolution clauses (mediation/arbitration before litigation).

• Maintaining shareholder/partnership agreements.

• Keeping accurate, written records of communications.

Spotting issues early is crucial. Send prompt reminders, issue formal notices, and attempt negotiation before positions harden. The Civil Procedure Rules encourage parties to seek settlement before court proceedings.

• Negotiation: direct discussions; cheapest and quickest.

• Mediation: a neutral third party facilitates settlement. Often highly effective.

• Arbitration: private, binding process; commonly used in international disputes.

• Litigation: formal court proceedings; necessary for high-stakes or intractable disputes.

• Damages: financial compensation.

• Specific performance: requiring a party to fulfil contractual obligations.

• Injunctions: stopping harmful actions (e.g., misuse of confidential information).

• Rescission: undoing a contract entirely.

Even if you win in court, enforcement may be necessary:

• Charging orders against property.

• Third party debt orders.

• Winding-up petitions for insolvent companies.

Business litigation is costly and time-consuming. Courts can order losing parties to pay winners’ costs, but the risk of non-recovery remains. Alternative Dispute Resolution (ADR) is often more commercially sensible.

Business disputes will never disappear, but they can be managed and resolved strategically. Strong contracts prevent many issues; mediation and negotiation resolve most others. Where litigation is unavoidable, having experienced solicitors ensures your business is protected.