Business Disputes.

In commercial litigation, the general rule is that the unsuccessful party pays the successful party's costs — so a business that wins can usually recover a proportion of its legal costs from the loser. However, recovery is rarely complete: the court assesses the costs, and the amount recovered is typically in the region of 60 to 70 percent of the actual costs incurred, even on a successful claim. In multi-track cases, costs budgeting caps the recoverable costs at the level approved by the court. Some costs may be irrecoverable, and if the case is lost, the business will usually have to pay the other side's costs as well as its own. The costs rules — including the impact of Part 36 offers — make the financial outcome of litigation uncertain, which is why an early and realistic assessment of costs against likely recovery is essential before committing to proceedings.

Terminating a commercial contract carries significant risk and should never be done without careful consideration. A contract can be terminated: under an express termination clause in the contract (for example, for material breach, insolvency, or on notice); or at common law, where the other party has committed a repudiatory breach — a breach serious enough to entitle the innocent party to treat the contract as at an end. The critical risk is wrongful termination: if a party purports to terminate when it is not actually entitled to, that purported termination is itself a repudiatory breach, entitling the other party to terminate and claim damages against the party that got it wrong. This is one of the most common and costly mistakes in commercial contract disputes. Before terminating, a business should establish clearly whether it has a valid contractual or common law right to do so, and follow any procedural requirements in the contract precisely. Taking legal advice before terminating is strongly recommended.

Not necessarily — the time limit for a professional negligence claim is not always measured from when the negligent work was done. The primary limitation period is six years from the date of the breach of duty (in contract) or from when the damage was suffered (in the tort of negligence). But where the business did not know, and could not reasonably have known, about the negligence at that time, the Latent Damage Act 1986 may provide an additional three years from the date the business had the knowledge needed to bring a claim — subject to a long-stop of fifteen years from the negligent act. This is particularly relevant in business cases where the consequences of negligent advice — a defective document, a tax problem, an inadequate structure — may not come to light until years later. Identifying the correct limitation period in a professional negligence claim can be complex and depends on the facts. Because missing the deadline is usually fatal, a business that suspects negligence should take advice promptly rather than assuming it is either in or out of time.

Directors owe seven general duties to the company, codified in Sections 171 to 177 of the Companies Act 2006. These are: to act within their powers, in accordance with the company's constitution; to promote the success of the company for the benefit of its members as a whole, having regard to factors including the long term, employees, and the company's reputation; to exercise independent judgment; to exercise reasonable care, skill, and diligence; to avoid conflicts of interest between their personal interests and the company's; not to accept benefits from third parties given because of their position; and to declare any interest in a proposed transaction or arrangement with the company. These duties are owed to the company itself, not to individual shareholders. Breach of these duties can result in personal liability for the director, including an obligation to compensate the company or account for profits. Directors should understand their duties, as breaching them — even unintentionally — can have serious personal consequences.

Where partners have not entered into a written partnership agreement, their relationship is governed by the default rules in the Partnership Act 1890 — and these default rules often surprise partners and cause disputes. Under the Act, in the absence of agreement: profits and losses are shared equally, regardless of the partners' respective capital contributions or workload; no partner is entitled to a salary; all partners are entitled to take part in management; decisions on ordinary matters are taken by majority, but changes to the nature of the business require unanimity; and — most significantly — the partnership is dissolved automatically when any partner leaves, retires, dies, or gives notice to dissolve. This last rule means that without an agreement, a single partner can bring the whole partnership to an end, throwing the business into crisis. The absence of a written agreement is one of the most common causes of serious partnership disputes, which is why putting one in place is strongly recommended.

A commercial contract dispute is a disagreement between businesses about the existence, meaning, performance, or termination of a contract. They arise in many ways, including: one party failing to deliver goods or services, or delivering them late or defectively; non-payment or disputed payment; disagreement about what the contract actually requires; a party purporting to terminate the contract; allegations that one party was induced to enter the contract by a misrepresentation; and disputes about the effect of particular clauses, such as limitation, exclusion, or force majeure provisions. Commercial contract disputes are among the most common business disputes and can affect supply chains, cash flow, and commercial relationships. The starting point in any dispute is always the contract itself — its terms determine the parties' rights and obligations. Taking early legal advice, with the contract to hand, allows a business to understand its position and options before matters escalate.

A director or boardroom dispute is a disagreement involving the directors of a company about how it is managed or about a director's conduct or position. They commonly arise from: disagreements about strategy or major decisions; conflicts between directors, or between directors and shareholders; concerns that a director is acting in breach of their duties or in their own interests; disputes about a director's removal or the terms of their departure; allegations of misconduct or mismanagement; deadlock at board level; and the pressures that arise when a company is in financial difficulty. Because directors are responsible for managing the company and owe it significant legal duties, boardroom disputes can have serious consequences for the company and for the directors personally. In private companies, directors are often also shareholders, so a boardroom dispute frequently overlaps with a shareholder dispute. Early legal advice helps directors understand their position, duties, and options.

A partnership dispute is a disagreement between the partners in a business about how the partnership is run, how profits are shared, or the conduct of one or more partners. They commonly arise from: disagreements about the direction or management of the business; disputes over the division of profits or partners' drawings; concerns that a partner is not pulling their weight or is acting against the partnership's interests; breakdown of trust between partners; disputes when a partner wants to leave or retire; disagreements about bringing in new partners; and the consequences of a partner's death, incapacity, or misconduct. Partnership disputes are often especially difficult because partnerships are built on a relationship of mutual trust and good faith, and when that breaks down the consequences can be severe — particularly where there is no written partnership agreement to provide a framework for resolution. Early legal advice is important to protect each partner's position and the business itself.