Whether you’re doing business with a sole proprietor or with a huge multinational corporation, disputes are inevitable—and they happen at every level of business. If your dispute with another business owner isn’t resolved quickly and amicably, though, it can drag on and cause all sorts of headaches, especially in the form of lost time and money.
Fortunately, there are ways to deal with your dispute without causing more trouble than necessary. Here are some tips on how to deal with a business dispute.
create a dispute resolution plan
Think of all disputes you’ve been involved in personally, professionally or both. Think about how each dispute was handled and whether it could have been better. Now create a plan that could be used to settle your most common types of problems.
If you come up with an innovative idea that could be useful, put it down on the plan and discuss it with your legal advisor.
Review Related Contract
Look at any contracts you may have signed, and make sure you’re reading them thoroughly. Are there any obligations or rules outlined in there that weren’t initially made clear?
Review all correspondence between you and your business partner, including emails, texts and phone calls. Look out for any promises they may have made—and keep track of when they were made—as well as their follow-up on said promises.
It can also be helpful to get an expert legal opinion if you’re not sure how to proceed in resolving your dispute. What’s an Expert Legal Opinion? An expert legal opinion is where two attorneys work together to solve a dispute: one works with you (the prospective client) while another works with your opponent.
Consult with a Lawyer
If you’re involved in a legal dispute, then you may need to consult with an attorney. The fee could be worth it, particularly if your business is at stake. Make sure to discuss your situation with them before taking any action. Your counselor can help you weigh out what action will hurt and which will help—you don’t want to make things worse!
Try to Reconcile
Do everything you can to reach an amicable solution. Everyone has their own style of negotiating, but when dealing with another person, it’s always best to get to know them as best you can and try to understand where they’re coming from. It might not always work out, but at least if you go into it knowing that you did everything possible, your feelings won’t be hurt quite as much.
If confrontation is inevitable—or even just likely—be sure to keep things civil by using effective communication strategies.
Find an Arbitrator
If you think you’re going to have a dispute with someone, it’s always best to seek out an outside arbitrator (ideally both of you agree to be bound by his or her decision). Doing so can make all parties feel more comfortable and ultimately encourage them to see if there’s any way to work out their issues instead of pushing forward in court. If you don’t have time for that, get your agreement in writing.
That may seem obvious, but too many business owners fail to formally document their agreements. It’s not just small contracts that should be written down either: The majority of large businesses are guided by documents as well. It doesn’t take long, and it could save your business later on.
Factors to consider for legal actions
The important thing you’ll want to do is assess whether or not legal action is in your best interest. Your options include going it alone and filing in small claims court, hiring an attorney and taking your case to civil court, or trying to settle out of court.
A couple of things to consider: What’s at stake? How likely are you to win? What does winning mean for your business? Remember that hiring an attorney will cost more than small claims court, but also remember that if you hire an attorney there’s a chance you won’t have to pay him/her unless they win your case.
