Dispute Resolution: 4 Key Factors to Consider when Assessing Whether You Need a Lawyer
In the modern world, disputes arise in a wide variety of ways, whether in your personal life or in the course of running a business. At the heart of every dispute is a disagreement or argument with respect to one or more issues between parties.
A majority of the disputes which we encounter in everyday life resolve on their own, and without legal intervention. However, in many cases, parties to a dispute are not able to resolve the dispute amongst themselves, and the dispute remains unresolved.
An unresolved dispute may strain the relationship between the parties. Even worse, an unresolved dispute may result in conflict escalation, which is the process where the conflicts grow in severity or scale over time.
Escalation in this context may be between individuals or groups in interpersonal relationships, or it may refer to the escalation of hostilities in a commercial context, whether between contracting parties or competitors.
The escalation of a dispute may lead to costly legal proceedings or other regulatory or disciplinary action which may have irreversible direct and indirect consequences which could seriously impact a person or their business.
Despite these risks, many parties are often reluctant to seek legal advice to resolve a dispute, largely due to the costs involved. By doing so, a dispute can get worse, and result in more severe financial consequences.
At the very least, a person should schedule a free consultation with a firm experienced in dispute resolution such as Potts Lawyers, so that a person can make an informed decision as to whether engaging a lawyer makes sense for them.
Do you need a Dispute Lawyer?
When assessing whether a person or company should obtain legal assistance with resolving a dispute, there are several important factors to consider.
Factor #1: What is my own capacity to resolve the dispute?
As a starting point, you will need to assess your own capacity for resolving the dispute. This may seem obvious, but is often overlooked and remains to be one of the most common elements we see in protracted disputes.
In most cases, a person will likely not have capacity to resolve the dispute on their own. An obvious sign that a person is unable to resolve the dispute on their own, is the fact that the dispute remains unresolved despite that person’s best endeavours to resolve it in a timely manner.
Furthermore, from a practical perspective, most individuals do not have the legal education or dispute resolution training or experience necessary to resolve most complex disputes. Often, a person’s industry knowledge or skills, alone, are not enough to resolve the conflict.
Let’s face it: you’re not going to become a dispute resolution wizard or master overnight with the assistance of “Google”. All too often, a person’s pride, stubbornness, embarrassment, or desire to reduce legal costs, may make them reluctant to seek help from lawyers in the first place.
This is the most common mistake that can easily be avoided by phoning a lawyer for a free consultation.
Even those who do have legal or dispute resolution training, almost always become emotionally involved when they are a party of the dispute. When you are a party to the dispute, your judgment is always affected by your personal or professional connection to the dispute.
A good litigation lawyer knows this, since, if they become involved in a dispute to which they are a party, they will always obtain their own independent legal advice, despite having the skills necessary to resolve the dispute.
Factor #2: Considering Any Warning Signs of Escalation
In all cases, there are benefits associated with resolving a dispute early, and serious risks involved in not obtaining timely legal advice.
Obviously, resolving a matter early can save you and your business significant time and money. Businesses and individuals who become embroiled in disputes have to divert resource (time and energy) to resolve the dispute, often to that person or business’s detriment. Early resolutions can also improve your health, since the stress and anxiety associated with these disputes can quickly take a toll on your mental and physical wellbeing.
To gauge whether your prospects of resolving the dispute early are dissipating, there are several ‘red flags’ or ‘warning signs’ to look out for, which indicate an escalation in your matter, which requires immediate legal advice to be obtained.
Warning Signs of an Escalating Dispute
Those ‘red flags’ or warning signs include, but are not limited, to:
- Negotiations reaching a ‘standstill’ or deteriorating completely.
- Communication between both parties deteriorating completely.
- A party becomes abusive or overly adversarial in nature.
- A party making legal threats or threats to get their lawyers involved;
- Receiving a letter or call from the other party’s solicitors;
- Receiving Court or Tribunal documents from the other party’s solicitors;
- Being contacted by a government body or another regulatory agency in relation to the dispute.
Factor #3: Does it make commercial sense to get a lawyer involved?
Another important factor in most cases, especially in a commercial context, is whether the dispute can be resolved affordably (or in other words, commercially).
Obviously, law firms are businesses that invest heavily in knowledge, and people pay a premium to access lawyers who are efficient and experienced in a particular area of law, including litigation and dispute resolution. The cost of litigation is complex and varies, and in all cases, there are no guarantees that you will get your costs back if you are successful at a hearing.
Usually, where there are higher stakes, there is also a greater probability that getting legal advice will make commercial sense. This applies to defending claims or allegations, too, since a lawyer may be able to negotiate a resolution which decreases a person’s exposure to liability by an amount which may greatly exceed a person’s legal costs associated with resolving that matter, or by an amount far greater than if the person was self-represented.
For most commercial disputes over $25,000, getting a lawyer involved makes commercial sense. Obviously, an experienced litigation and dispute resolution lawyer will tailor a client’s strategy to be more cost effective for smaller disputes, and will employ different strategies for resolving a $25,000 dispute, as opposed to a dispute over $250,000 or even $2.5 million dollars.
In contrast, it is unlikely that it would make any commercial sense to pay legal costs in an attempt to resolve a dispute with a customer concerning a purchase of goods or services for $1,000, however there are exceptions to this rule discussed in the next section.
Factor #4: Are you aware of all Hidden or Additional Issues?
Obviously, there are many exceptions to the commerciality factor discussed above. In some cases, a person will want to immediately seek legal assistance for resolving disputes which may, on the surface, appear to be minor, or which may involve a small amount of money.
This is because the failure to resolve a smaller dispute, or a seemingly trivial or insignificant conflict, could lead to more serious – and possibly disastrous – consequences.
In a contractual context, a small dispute also might allow one party to terminate the entire contract with the other party, if the aggrieved conduct involves an actual breach of the contract. The contract may also allow the terminating party to seek compensation from the party who is in breach of the contractual agreement.
This is a common way in which a seemingly ‘small’ dispute could have disastrous consequences.
Similarly, an unresolved dispute with a client or business (however small or minor), could lead to a complaint being made to regulatory authorities, which may result in further regulatory or disciplinary action against a person or business.
Any such regulatory or disciplinary action could, in turn, result in a person or business losing their licence or registration. In circumstances where that licence or registration is required to operate, this could obviously be fatal to that business or a person’s career.
These secondary issues and consequences are often overlooked or missed by someone who attempts to resolve the dispute on their own without lawyers. No matter how insignificant or trivial the dispute may appear, individuals attempting to resolve a dispute should seek legal advice on all ancillary issues involved, by taking advantage of law firms that offer free consultations.
In summary, when ascertaining whether or not to get lawyers involved, it is important to consider:
- Your own capacity to resolve the dispute;
- Warning signs of escalation which may impede an early settlement;
- The commerciality of getting lawyers involved; and
- Whether hidden or ancillary issues are present.
Potts Lawyers can provide individuals and businesses with free consultations which can address these 4 factors. In doing so, you will get realistic and clear advice on whether further legal intervention is required, based on your unique circumstances.
Why Choose Potts Lawyers to Resolve Your Dispute?
Potts Lawyers is a respected law firm which is experienced in dispute resolution. We always employ strategies which are tailored to each of our client’s individual needs, and ensure they are fully informed of the risks throughout the entire process as developments arise.
While its always preferable to obtain legal advice as early as possible, its never too late to call, since effective representation can increase your prospects of obtaining a successful outcome, no matter what stage the dispute has reached.
Contact our Offices
Please contact us today on: Brisbane: (07) 3221 4999 or Gold Coast: (07) 5532 3133 or book a free consultation.