July 2011 – When should you use the Courts to solve business disputes?


Business Law Update
July 2011

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Gary CousinsWelcome to our July newsletter. 

This month’s feature article looks at when to use and when to avoid Court to solve business disputes. There’s some useful advice on getting permission to use designs and photographs and in our blog round up there’s a further reminder about the new Bribery Act rules which came into force on 1 July 2011.

We hope you will find information relevant to your business in this month’s issue. Email your article suggestions or legal questions to marketing@business-lawfirm.co.uk.       

Gary Cousins
0121 778 3212

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The pros and cons of settling commercial disputes in court

When two businesses lock horns it’s never easy to find a resolution. But taking a case to court isn’t always the best answer and certainly isn’t the only option.

Going to court is just one of several options available to resolve a dispute and, often, the best solution is a mix-and-match approach: using some of the court procedures where they are effective but not using the court trial process to obtain a final decision.

The case for taking your case to court
Courts do have some very real advantages over other forms of dispute resolution:

  • The process is compulsory – if you have a claim against someone and they are not taking it seriously or are even totally ignoring it, issuing court proceedings is a good way of making them face reality. A court Claim Form cannot be ignored; if it is, they will end up with a judgment against them and the possibility of bailiffs knocking on their door.
  • Detail – often in business cases, the devil is in the detail. Sometimes the parties can’t agree on what a contract actually means. Courts are ideal at resolving these issues. Often, the other side has information about what happened that they won’t let you have and which has an important bearing on the case. Courts have extensive powers to investigate what went on: forcing parties to disclose documents (on computers as well as written documents), and requiring each party to put forward witnesses to explain what happened and to answer questions necessary for a full understanding of the case.

The case against
Courts have substantial disadvantages too:

  • The procedure can be expensive, mainly because the courts do take a thorough approach, and that might not be suitable for every case. The final preparation for a trial and the trial itself will usually cost as much as all the other steps put together. 
  • The procedure can be intimidating if you’re not familiar with it – the procedure and court etiquette is complex, judges wear robes and sit in front of the courtroom at a higher level than the other participants, usually insist on being spoken to in a certain way and in a certain order, and like to be referred to as “My Lordship”.

There are other ways of resolving disputes, including negotiation, mediation, adjudication and others – see our Definitive Guide to Solving Business Disputes for a full discussion on all the options and techniques for solving disputes effectively.

Often the best option for solving a dispute is the mix-and-match approach: using the best elements of the court process together with another method such as mediation to reach a final resolution of the dispute.

For example, if you have a claim and the other party is trying to ignore it, consider issuing court proceedings to make them take it seriously - and then use mediation to resolve the dispute.

You might have a claim where something went wrong but you can’t get to the bottom of what happened and need to see documents the other party has but they won’t give them to you. In such cases, consider issuing court proceedings and using the court’s powers to obtain the documents you need and then negotiate or use mediation to resolve the dispute rather than go to trial.

No two cases are alike and it is important to get advice from a specialist solicitor who deals not just with litigation (going to court) but also other forms of dispute resolution and who takes a creative and proactive approach to managing disputes.

For advice on commercial disputes call Gary Cousins on 0845 003 5639.

Download a free copy of our White Paper – The Definitive Guide to Solving Business Disputes here.

Plain English Legal Advice

Permission for using designs and photographs 

It can be a shock to a business to receive a demand for compensation for unlawful reproduction of images, such as photographs and other artistic and design work. Usually this comes in the form of a written demand from a stock image house such as one of the world’s biggest agencies, Getty Images, who actively pursue such claims.

So what is the law? And how do you protect yourself from such demands?
With the explosion of social networking sites has come a corresponding explosion in the publication of photographs and videos. It is so easy to post to the likes of Facebook®, Twitter®, LinkedIn® and Flickr®. Flickr alone saw over 4,000 photos uploaded in one minute as I was writing this article and the geotagged items alone number 148,943,201! Back in 2005 they had just 5 million photos on the site.

It is so tempting for anyone looking for a photo for commercial use to find one on the web and it’s a common assumption that everything seen on the web is free! Do not make that mistake. Go to a stock house like Getty Images and buy the right to use a photo. Or, if you spot a photo you like on a website, approach the copyright owner, and ask permission. They may give it for free, but you do need that vital permission confirmed in writing (email is fine).

But what is the position on ownership and use of these photos? Who can use them and when?
Put simply, if you take a photograph, shoot a video, or create a design or artistic work, you own the copyright. No one else may reproduce it without your permission by posting it on their website, or printing or copying it in any way. This applies unless you have assigned your rights to someone else.

Many photographers sell the rights to stock houses like Getty Images. They may sell the copyright outright, so the image house has ownership and all the rights, or they may sell just a right to reproduce, retaining the copyright ownership for themselves.
As a recent example there was the stunning image of the Space Shuttle shooting through the clouds taken on her mobile phone by an airline passenger flying nearby in Florida. It went viral on Twitter and the BBC contacted her and obtained permission to reproduce it on their news website. But there are many out there who do not behave like the BBC!

Almost every image created digitally has a unique tag, its metadata. It identifies the photo and even the make, model and serial number of the camera it was taken on. Of course this is a bit more complicated when it comes to scanned images, but it is possible to tag every image with unique data and a copyright symbol. What this does is make it possible for anyone to search the web and find out who is using their photos, and even to trace missing cameras! That all important metadata is the giveaway. And this makes it easy for image houses like Getty to track unlawful use of photos and demand compensation from the culprits.

So what can you do?

  1. Make sure all your own images are tagged with a copyright symbol with your name, e.g. in my case ‘© Nigel Musgrove’. Usually you can do this in the software you use to upload the image to your PC, and in the uploader on the likes of Facebook® and Flickr®.
  2. Flickr® has settings which allow you to restrict who may view and use the photos. Facebook® has its own privacy controls. Make sure you use these and retain copyright and therefore control over use.
  3. If you are using photos on your website or in any publication, even if they have been provided by a web or other designer, make sure you have permission to use them and you have a record of it. Do not assume that the designer has obtained permission. If they haven’t, it is you who will be liable to pay compensation for their use.
  4. If you have any issues, take legal advice at an early stage.

For further details call Nigel Musgrove, business and litigation solicitor, Cousins Business Law on 01285 847001.

Blogs in brief 

Changes to pre-pack administration proposed 
Commercial property Solicitor, Paul Harrison, provides useful advice to landlords on how to protect themselves against tenants going out of business, in the light of proposed changes in insolvency law. Read more...

Are you ready for new Bribery rules? 
The Bribery Act came into force on 1 July 2011 creating two general offences, one of offering, promising, or giving a bribe, and the second of requesting, agreeing to or receiving a bribe. These are offences committed by individuals. There is also an offence of bribing a foreign official, and perhaps the most important offence as far as all organisations are concerned, an offence by a commercial organisation, which includes partnerships, of failing to prevent bribery. If you haven’t already done so, now is the time to address the six general principles outlined for commercial organisations. Read more…

Claiming Capital Allowances on commercial property 
It is estimated that over 90% of all commercial property and furnished holiday lets could be entitled to tax relief and often the savings can be significant. Many commercial property owners are either unaware or have not yet claimed the full level of Capital Allowances that they are entitled to under UK tax law. Read more…

Useful Links

Tips for getting working capital
Our favourite online business publication, Real Business, has published another one of their useful articles. This time it provides advice in the form of 10 Tips on Getting Working Capital, a useful reminder on all the things to consider if you are in a position where you need more working capital in your business. 

Business support videos
Business Link’s YouTube Business Support channel contains a range of case study videos: everything from creating a brand with founder of Yo Sushi, Simon Woodroffe, to starting a business in a slump

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Cousins Business Law is a member of the Law Society & regulated by the Solicitors Regulation Authority under number 485128. Head Office: Swan House PO Box 11543, Birmingham, B13 0ZL. Tel +44 (0)121 778 3212. Fax: +44(0)121 275 6155