Resolving disputes

It is almost impossible to pass through life without becoming embroiled in a dispute. This might be a falling out with your relations over an inheritance, a partnership bust-up, a dispute with a neighbour over a boundary or private right of way, a contractor, an employee, a tenant or a utility provider, to name but a few.

Often, members are unsure of the best way to resolve the matter. Putting the problem to one side and getting on with your day is one approach, but it is seldom a good strategy, as the problem can fester and lead to positions becoming polarised and entrenched. On the other hand, prematurely instructing a solicitor to send the other side a letter out of the blue could ignite a potentially volatile situation.

However, having a discussion with the CLA’s legal department or regional advisers sooner rather than later can help put things in perspective, and identify and clarify the key issues. On a daily basis, the CLA legal department reads through contracts, title deeds and so on, assesses the strength of our members’ position and provides independent and pragmatic advice, including next steps.

A meeting between the parties to discuss the issues and try to reach an amicable solution is also a good start as often, at this stage, any misunderstanding can be resolved, clearing the path to overcome the problem. Negotiation is the simplest and most effective way to resolve many differences. When it comes to consumer issues such as utilities, telecoms, financial and legal services, members should see whether there is a formal complaints procedure and, if so, follow that, since a formal complaint may well sort out the issue.

However, if the suggestion of a conversation is rebuffed or the outcome of a complaint or negotiation unsatisfactory, then a form of Alternative Dispute Resolution (ADR) may well be the answer. Mediation is usually the example that springs to mind, but it is not the only one, and the form of ADR used may well depend on the nature of the dispute.

There are several ADR schemes and Ombudsman services specialising in various problem areas for consumers, such as the Energy Ombudsman, in the case of gas and electricity, and the Financial Ombudsman, which deals with insurance, banking and soon. The definition of ‘consumer’ can be quite wide, and members should check whether they are eligible. Early Neutral Evaluation (ENE) is a confidential and non-binding process, generally (but not always) used in the early stages of a dispute; the parties choose a suitable neutral person, such as a retired judge or senior barrister, to evaluate the strengths and weaknesses of their respective cases to enable them to settle the dispute themselves. ENE is generally used for contract and commercial matters, but can also be suitable for family and other disagreements.

Mediation also enables parties to resolve their differences. It is a process by which opposing parties and sometimes their advisers are brought together to engage in a structured and interactive way to find a solution. If successful, the outcome is a binding, workable agreement signed by the parties. Mediators are neutral and non-judgmental, and are encouraged to engage in problem solving, developing options and building agreement of common interests. One of the main benefits of mediation is that it can get to the real heart of the dispute in a way that no court or tribunal claim can ever do.

Arbitration is mostly used for commercial, rent review, construction and similar disputes, but the Advisory Conciliation and Arbitration Service (ACAS) does provide a service for employment matters. Arbitration has certain advantages over litigation in that it is flexible and confidential. The outcome is usually final, as the parties often choose the arbitrator, who will usually be an expert in the subject matter of the dispute.

For some time, the mantra has been and continues to be that bringing court and tribunal claims is a matter of last resort after other attempts at resolution have failed. Indeed, the court expects the parties to have corresponded with each other to provide details of their respective positions by following what is known as a pre-action protocol (which includes suggesting ADR) before starting a claim. Employment tribunal claims are different in that an employee has first to go through the ACAS Early Conciliation procedure.

Court claims should not be embarked upon lightly. Cases take many hours of preparatory work to ensure that the court case management directions are complied with, are put together thoroughly and all the evidence compiled. It will almost always be prudent to instruct a solicitor to maximise the chances of a successful outcome, unless the claim is under £10,000 and is allocated to the small claims track of the county court, where costs are not usually awarded.

If a claim is not settled before trial (and the court does expect the parties to try, usually through mediation), the outcome will be that there will be a winner and a loser; generally, the loser has to pay most, if not nearly all, of the winner’s legal costs.

On top of that, although the court cannot compel mediation, there is a great risk that a successful party who has unreasonably refused mediation will suffer a costs penalty as a result. Tribunal claims can be risky and expensive but, generally speaking, the recovery of legal costs can be limited depending on the tribunal concerned.

Conflict can be costly not just in terms of money, but also in terms of management time and stress – even if members have legal expenses insurance, which does have its limitations, or have arranged another type of available funding. Prevention is usually best, and CLA guidance notes and magazine articles provide regular updates.

Our advisory handbooks, which can be purchased online, cover a myriad of topics if you need information, or perhaps more details about something specific. The advisers may not be able to wind back the clock, but we are always here to help you as the first port of call going forward.