Minor Disagreement or Major Problem?: 6 Signs Your Business Dispute May be Headed for Litigation

Informal negotiation can resolve the vast majority of business disputes. However, some conflicts will inevitably lead to litigation. Disputes bound for litigation often have similar attributes—that means that you can sometimes predict which business disagreements will end up in the courtroom. Often, business disputes headed toward litigation will have the following characteristics:

 

  1. Communication Problems

 

When people communicate well, they are far more likely to work out disputes. Unfortunately, some business disputes get heated, and communication is virtually impossible. In many situations, one side will simply stop trying to talk to the other entirely—failing to return phone calls, not responding to emails, and even refusing to pick up certified letters. In these situations, one side may feel that they have to start the litigation process just to get the other party to respond at all.

  1. Parties Refuse to Compromise

Negotiations require some degree of give and take. In some of the most successful compromises, neither party really feels like they “won” or came out ahead. Unfortunately, when one party just refuses to budge on their position, the dispute may lead to litigation.

  1. One Side is Taking Things Too Personally

Business disputes are just that—business that needs to be resolved. However, some business owners will take problems with service or products far too personally. Sometimes pride or even a misunderstanding of what the problem really is can lead to litigation.

  1. The Other Side “Lawyers Up”

When the other party obtains an attorney, that is almost a sure sign that your dispute is headed down the path towards litigation. Having a lawyer can sometimes help the negotiation process, but usually, when someone engages an attorney, he or she has moved passed the negotiation stage and wants to take more drastic steps. If the other side has a lawyer, it is a good idea that you get one as soon as possible too.

  1. Neither Party is Listening to One Another

If it feels like you and the other party are talking over and past one another, you may be headed to a more formal dispute resolution process. When both sides stop communicating effectively, it may be time to bring in someone else to continue the negotiation process. Mediation may be more effective than litigation in these circumstances, but sometimes filing a lawsuit is part of that process.

  1. Your Contract Was Poorly Drafted

Business disputes often arise out of a poorly-written contract. One party may think the contract meant something else than what you thought. There is little you can do about these situations if neither party is willing to compromise. Instead, you may be forced to rely on contract interpretation principles, which often requires the court involvement.

In some circumstances, you may be able to stop the dispute from heading toward litigation by involving an attorney who is knowledgeable and experienced in California business law to help you negotiate. Call Integrated General Counsel, P.C. at 925-399-1529 to discuss your legal options.

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Written by Integrated General Counsel

Our focus includes handling a variety of corporate matters and also includes litigation in state and federal courts. Our current practice includes providing transactional services and representing a variety of small and medium-sized companies as their outsourced general counsel.