When you run a business, you know that it’s not always going to be smooth sailing. Every now and again you’re going to have to deal with disagreements.
If you’re lucky, a lot of them can be resolved pretty easily, but there are sometimes a few that take a bit more work than a quick phone call.
Disagreements that spiral into disputes put pressure on contracts and working relationships.
The earlier you recognise the signs of trouble the better chance you have of protecting both your position and the relationship itself.
Warning signs to watch for
It’s easy to say you were blindsided, but disputes rarely appear out of nowhere. Nine times out of ten there are early indicators that something isn’t quite right.
Payment delays are one of the most obvious. A client or supplier who suddenly changes their payment pattern may be struggling financially or signalling dissatisfaction.
Another warning sign is a change in their tone or behaviour. If communication becomes inconsistent or strained this can suggest they may not trust you.
Likewise, if one party begins to interpret contractual terms in a different way than what was previously agreed, this is a clear red flag.
You may also notice signs of reluctance to meet obligations in full. Late deliveries, reduced service standards or frequent excuses can all point to a deeper problem.
How can you prevent the escalation of commercial disputes
When these signs appear, the sooner you acknowledge them and try to de-escalate the better.
Start by having an open and honest conversation with the other party. Ask if you can arrange a call or have an in-person meeting to figure out where the issues lie. Once you know what the problems are, you can propose a plausible workaround.
Raising concerns early shows you are attentive and are willing to give the other party the opportunity to explain or correct the issue.
We advise keeping detailed records, including:
- Notes from meetings
- All correspondence (emails, calls, letters, texts, in-person visits, etc.)
- Any variations to agreements
It’s also worth revisiting the contract at this stage. Understanding precisely what has been agreed and what your rights and obligations are strengthens your ability to manage the situation fairly.
Options for dispute resolution
If issues persist despite early intervention you may need to consider formal resolution methods.
Before you pick your preferred method, check the contract for a dispute resolution clause.
This should provide details on how each party is expected to attempt to resolve the dispute before it ends up in court.
Mediation is often the least confrontational route and avoids the cost or delay of court proceedings.
Arbitration can provide a binding decision in a more private setting than litigation. It is often quicker and can be tailored to your industry.
Litigation is the most formal route and is sometimes unavoidable, particularly where significant sums or urgent remedies are involved.
Seeking professional advice at the right time can be the difference between a quick resolution and a drawn-out dispute.
There are limitation periods that can dictate the timeframe for bringing a claim.
In England and Wales, the limitation period for breach of contract claims is usually six years, though this can be longer for contracts made as deeds or shorter if the contract specifies a different timescale.
We can help you weigh the risks and identify the most practical way forward for your business.
Speak to us to find out how we can help you resolve commercial disputes before they escalate.