January 2009 - Spotting a business dispute


Business Law Update
January 2009

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from Cousins Business Law

Gary CousinsWelcome to the first issue of the Business Law Update from Cousins Business Law in 2009. This month we feature some useful tips on how to spot a business dispute before it even happens, plus there’s our newly published Guide to Doing Business in the UK.

I hope you will find information relevant to your business in this month’s issue. We are keen to cover topics of concern to business people so if you have questions or topics you would like us to cover, email your ideas to marketing@business-lawfirm.co.uk.


Gary Cousins
0121 778 3212

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Spotting a business dispute on the horizon

It is not uncommon for business people to come to us for advice on a dispute once it has reached an advanced stage – usually once they receive a solicitor’s letter or court proceedings have already started. If you can nip a dispute in the bud, so to speak, it can often be resolved much more quickly and with far less cost.

So how can you tell there might be a dispute looming?

  1. Payment delays. It is not unusual in the present economic climate for SMEs to experience delays with payment – usually this is a sign of your customers trying to manage their cashflow. However, it can often be a sign that someone is not happy with your goods or services. It is definitely true that we British do not like to complain and so, frequently, the first sign of a dispute brewing will be a lack of payment.

    If you are experiencing payment delays, ask why. If your customer has a complaint, it is better to know sooner rather than later, as problems can often be sorted out before firm positions are taken and lots of money spent on legal fees. If they don’t complain and just say it is down to cashflow problems, confirm this in writing – then you’ll have some evidence that they were happy with your goods or services should they later make a claim. If they still fail to pay up, take action to recover the debt, taking the Cousins Business Law zero tolerance approach to bad debt, and reduce the likelihood of this happening in the future.

  2. Communication dries up. Another sign of a dispute brewing is when someone stops communicating with you. We live in an age of instant communication so, if someone has stopped returning your calls or emails, especially when they used to respond quickly, there is generally something wrong.

    If this does happen, take it as a signal to get your paperwork in order and seek advice. We recommend 5 steps to effective handling of business disputes. Often, a solicitor’s letter will restart communications. Even if their response is not what you would want to hear, it does open the way to resolving any dispute.

  3. Guilt. Do you feel that something went wrong with a particular client or contract? It is natural not to want to admit fault but, if you do feel that you should have done better, then this again is a sign to get your paperwork in order and seek advice. That advice might well be that you are in a much stronger position than you thought but, if not, at least you can start marshalling your strengths and weaknesses in preparation in case a claim is eventually made.

Our prediction is, that as the economy continues to falter and businesses across the world start to suffer, there will be a continued increase in the number of business disputes which, if not carefully managed, could see small and medium sized businesses facing punitive legal bills or, worse, being driven to the brink of existence.

Take advice, take it as soon as you spot a dispute on the horizon, and you will have a much better chance of preventing a full blown dispute occurring, or at least minimise the time and cost involved in a case that’s unavoidable and maximise your chances of success.

Cousins Business Law offers a free half-hour telephone consultation for anyone with a business dispute. Call us on 0845 003 5639 or book online here.

Legal Update

Doing business in the UK

In spite of the current global climate, cross border trade continues and, for any foreign owned company doing business in the UK, there are some basic aspects of the UK legal system which are essential to understand.

Cousins Business Law has published a useful Guide to doing business in the UK. Written for overseas business owners who are either currently doing business here or are considering trading in the UK. It’s also a useful ‘quick guide’ for British businesses too, as it records the basic aspects of the law which relate to all trading relationships here.

 The Guide covers:
  • The issue of jurisdiction and the laws of England and Wales
  • Business structure
  • Trading laws and regulations
  • Employment and staff issues
  • Property
  • Handling business disputes

Download a PDF copy of the Guide to Doing Business in the UK from the Cousins Business Law website or view the Guide online here.

Plain English Legal Advice

Determining the boundary of your property

Disputes between neighbours over boundaries often arise through an (understandable) misconception about the importance of the Land Registry plan in your title deeds. So it’s essential when buying property, whether business premises or your next home, to ensure you understand where the boundaries are.

Many people wrongly believe that the red line on the Land Registry plan is conclusive evidence of the exact line of the boundary and frequently neighbours attempt to resolve disputes by scaling off boundaries from the Land Registry plan.

However, the ‘General Boundaries Rule’ (set out in s60 of the Land Registration Act 2002) explains that this isn’t so. In fact, it confirms that the lines on your title deeds are not conclusive evidence of the exact line of your boundaries.

If your deeds don’t tell you, then how do you establish the exact line of a boundary?

A solution is a Land Registry procedure known as ‘determining the boundary’. This procedure requires the production of a very precise plan showing the exact line of the boundary. The plan will need to be sent to the Land Registry with a completed application form (form DB) together with the Land Registry fee (currently £80).

To successfully determine the exact line of a boundary, you will need to make sure that the exact line of the boundary sought is consistent with the title deeds. You will also need to use a qualified surveyor to draw up a plan that meets the Land Registry’s requirements.

Unfortunately, the flaw in this procedure is that it requires the consent of your neighbour. If you apply to the Land Registry to have the exact line of your boundary determined without the written agreement of your neighbour, the Land Registry will write to your neighbour to give them notice of the application and give them an opportunity to object.

If your neighbour objects (and you cannot agree the boundary between yourselves), the dispute can be referred to the Adjudicator to Land Registry, although in our experience they tend to steer people to the Courts.

Possibly the only foolproof way to ensure you never have a boundary dispute would be to require the seller to follow the ‘determining the boundary’ procedure for all the boundaries before you purchase a property. This will almost never be possible in practice however so perhaps the best advice is to try to build a good relationship with your neighbours in the hope that any disputes can be resolved amicably.

If you have tried the amicable route and find yourself in dispute with your commercial neighbour you’ll need to take professional legal advice. Contact Cousins Business Law here.

Useful Links

Using Facebook to Promote Your Business

If it’s good enough for the new President of the United States – maybe it could work for your business too.

Social networking seems to be becoming ever more popular – and the next big thing could be using sites like Facebook to promote your business. Inside CRM has published an online guide – 100 Tools and Tips to Tap the Facebook customer base – you can read more about marketing on Facebook on their website.

Compare Broadband Options

Not convinced you are getting the best deal from your broadband provider? Broadband expert needs only your postcode to provide you will a list of broadband options, their prices and services. They also have a tool which claims to show how much you can save by switching broadband provider. As with all of these tools, it’s advisable to check out their results but could be a good starting point for any business owner thinking of switching broadband.

Litigation Madness

Overseas Insanity

This month we report on a few foreign cases, proving that litigation madness is certainly not confined to the UK.

In Wisconsin, USA, a man sued a television company claiming that the company had made his wife fat and his children lazy. He said, “I believe the reason I smoke and drink every day and my wife is overweight is because we watched the TV everyday for the last four years”. He didn’t win.

In Las Vegas, USA, there is a law stating that lap dancers are not allowed to fondle or caress any patron with intent to arouse him. The court was asked to strike out the law as being unconstitutional on the basis that it was too vague and therefore unenforceable. The trial lawyers spent most of the case arguing whether the grinding of the dancers’ bottoms into men’s laps and the brushing of their breasts into their customers’ faces could actually be construed as a ‘fondle or caress’. The court came to the very sensible conclusion that the police would be able to tell a fondle or caress if they saw one, something that the lawyers clearly couldn’t do!

And, to balance things up, a very sensible case. In Germany, a lawyer acted for an elderly woman who had been sent a tax demand for €287 million even though her annual income was just €17,000. He sent one letter to the taxman and the demand was immediately withdrawn. As German law entitles the lawyer to charge a contingency fee (a percentage of the reduction he obtains) and provides that the authorities must pay it, the taxman was ordered to pay the lawyer’s fee of €440,234.

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Cousins Business Law is a member of the Law Society & regulated by the Solicitors Regulation Authority. Head Office: Swan House PO Box 11543, Birmingham, B13 0ZL. Tel +44 (0)121 778 3212. Fax: +44(0)121 275 6155