What is Commercial Litigation?
Commercial Litigation refers to the process of a legal case going to court where the dispute is either between two or more companies or between a company and an individual. This usually arises where the parties are unable to resolve a matter which could happen for many reasons.
We can assist with a range of commercial disputes including:
- Shareholder disputes
- Professional negligence
- Franchise disputes
- Alternative dispute resolution
- Corporate recovery and insolvency
- Contract disputes
- Consumer claims
- Commercial and retail leasing disputes
- Banking and financial services claims
- Defamation claims and Non-Disclosure Agreements
- Intellectual property – copyright, trademarks, and patents disputes
- Building and construction disputes
The Court process for Commercial Claims
Making a Claim is initiated using a Claim Form N1 and an N1(CC) for the High Court, Queen’s Bench Division, Commercial Court. The Claim must include details of the Claimant, Defendant, brief details of the Claim, Particulars of Claim and a Statement of Truth signed by the Claimant or its legal representative.
Witnesses will need to be ascertained and Witness Statements provided with relevant documentary evidence attached such as contracts, invoices and receipts, terms and conditions, insurance documents, bank statements, evidence from Companies House including company shares, capital, debts, and anything else required to be disclosed either by the other party or the Court.
Expert Witnesses can be extremely useful and can make or break a case. An expert witness can be used for various issues. Although witnesses can be appointed by either party or the Court, their duty will be to the Court to provide independent, impartial evidence based on their experience and expertise on a particular subject relevant to the case.
The Claimant will also have to pay a Court Fee, which is typically 5% of the claim value.
It is important to check that the Defendant’s address is correct and ensure that documents are served correctly.
After a Claim is served
The Defendant can either admit the Claim on the Acknowledgement of Service (Form N9 or N9CC for Commercial Court Claims) and return it to the court; defend the Claim and return the Acknowledgement of Service within 14 days with the Defence (and any counterclaim) to be submitted as directed by the Court; or dispute the jurisdiction of the Court, for example, either that it is in the wrong Court or country.
If the Defendant fails to file the Acknowledgement of Service the Claimant may apply for Judgment in Default.
A straightforward claim should be dealt with within a few months. More complex commercial litigation can take years to reach a conclusion and be costly for all parties involved.
Before proceeding to Court
Parties should take certain action before a matter is taken to court and try to reach an amicable resolution. Communication is key and if there is an issue it should be conveyed to the other party as soon as possible so that they may do something to rectify it.
During a commercial dispute, it is important to keep chronological diary/notes, including all communication with the other party/parties, what was said and what was agreed. Relevant documentation should also be gathered which will help when collating evidence if the matter goes to court.
If you are facing a legal dispute, you should obtain legal advice as early as possible. All parties should check how they can pay for any legal fees and court costs and possible compensation if awarded against them to the other party/parties. Many parties have insurance which could cover legal issues, claims and representation in court, so this should be ascertained at the earliest opportunity.
The Civil Procedure Rules (CPRs) provide the Court with certain powers and govern the case management of cases throughout the court process and provide Practice Directions which give guidance on all aspects including Claim Forms, Particulars of Claim, Defence, Case Management Conference, Allocation to Track, Disclosure, Court Hearings, and every stage until and including the Trial.
Parties who wish to make a claim or need to defend a claim or make a counterclaim, should get advice from a Solicitor at the earliest opportunity so that they may be guided in completing the relevant court forms and follow the protocols required. From the outset there are Pre-Action Protocols under the CPRs that each party must adhere to depending on what sort of claim it is and in which Court it will be heard.
The Court decides at the outset where cases will be heard, called ‘Allocation to Track’. In England and Wales smaller claims under £10,000 are dealt with in the County Court (Small-Track Claims), though there are some exceptions. Claims between £10,000 and £25,000 are usually allocated to the Fast Track. However, all Claims in the Commercial Court which is in the Queen’s Bench Division of the High Court are automatically allocated to the Multi-Track which usually deals with more complex cases over £25,000.
Breach of Contract Disputes
To Claim for breach of contract a Claimant must prove that there is a valid contract including an agreement, either in writing or verbal, which included an offer and acceptance, intention by both parties to be bound, that they both gave consideration, in most cases paid money or provided services or goods, that the Claimant performed under the contract, that the Defendant did not perform and breached the contract and those damages should be paid as a result. Examples include a person claiming against a company/business for unfit goods, or a company/business taking an individual or another company to court for non-payment of goods or services.
Remedies for breach of contract include compensatory damages, termination of contract, specific performance of the contract (where the court orders a party to do something), an injunction (where the court orders a party not to do something), rescission of the contract to put the parties back in the position they would have been if they had not entered into the contract, liquidated damages and nominal damages.
Companies House is a useful resource for finding information on a company which may be a supplier or distributor of goods, a new customer, or a company trying to get a contract. It is important to research companies at the outset and throughout to gain knowledge on their background and state of the company including the registered address, debts owed including mortgages, charges and County Court Judgments against it, Directors and Shareholders information, yearly accounts including up to date tax year accounts, insolvency and strike off information.
If a company is not registered at Companies House it is usually a sole trader and they can still be taken to Court in their own name, sometimes with a ‘Trading As’ name.
Alternative Dispute Resolution
Before a case goes through the Courts the parties should have considered and tried some type of Alternative Dispute Resolution. There are several types of ADR available depending on the nature of the case such as Mediation, Adjudication, Arbitration, Negotiations, and Evaluations. ADR is usually less expensive than going to Court and, if successful, avoids the need for going to Court altogether. Alternatively, it may provide clarity on the relevant issues going forward into the Court process.
We offer many years of expertise with commercial litigation across a broad range of matters, and have represented claimants, defendants, and appellants in all tiers of the legal system.