Many individuals ask law firms about Commercial Litigation vs Civil Litigation and which type of litigation avenue they require for their legal dilemma. The litigation process is a means to obtain compensation for damages over a dispute that has taken place, either involving yourself as an individual or as a company or partnership. Generally, there are two types of litigation, commercial litigation and civil litigation, both with their own unique set of characteristics, which will be explained in this article. A branch of commercial litigation is also insolvency litigation which deals with bankruptcies of individuals and company administration and liquidation.
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Though both commercial and civil litigation may seem similar, there are several key differences.
In this article, we’ll look at what those differences are and help you figure out which type of litigation is right for your needs.
When two people enter into civil litigation, it’s not just about what happened between them. So many factors come into play, including who was involved and why the case has come to court in the first place. In England and Wales (Scotland has a different system, learn more), in civil litigation, one side claims damages in terms of financial reimbursement/compensation from the other and tries to settle the matter out of court, and only when a settlement is not possible, and litigation is a last resort that both parties consider necessary, are proceedings commenced, both parties being aware of the costs position.
Furthermore, depending on the value of the claim, be it commercial or civil litigation, litigation can commenced as a small claims track case, generally valued up to £10,000, a fast track case, for values between £10-000 to £25,000, or as a multi-track case, for complicated cases of values over £25,000.
Commercial litigation can involve disputes between companies or businesses who have had a disagreement leading to court proceedings. Such cases are usually far more complex than civil litigation matters and as a result, deciding what should happen in these cases takes longer.
Within such cases, there may well be plenty at stake for both sides; therefore, the details must get worked through by expert commercial litigation solicitors until an accurate decision has been made about how to resolve it.
Commercial litigation is the most suitable option for business-related parties as it provides them with an opportunity to have their desired outcome through a detailed examination of events.
Examples of commercial litigation can be wide-ranging, but some of the high net worth cases at Gulbenkian Andonian Solicitors involve how to sue a company, debt recovery, tax disputes, shareholder disputes, building disputes, and so on.
Similarities of Commercial and Civil Litigation
While the two processes have different styles of participants, both do involve an investigation into what’s happening. Moreover, legal teams and solicitors who are representing parties may well look for alternative resolutions while following pre-action protocols to find a compromise before court proceedings, if necessary/ appropriate, are commenced. However, if this is not the case and no solution can be found, proceedings will be instituted and designated to the appropriate track.
If you are navigating the UK litigation process, there will undoubtedly be a process of disclosure and inspection of documents, and at times a payment into court by a party to try and settle out of court ( which will have to be accepted by the other party within a time limit to avoid costs implications), and it may also be necessary to serve expects reports ( such as in building disputes, and medical negligence litigation.
When the trial process begins, you would obviously want it to sway in your favor; however, ending it successfully depends on each phase of the proceedings, so be sure to consult a team of expert commercial litigation solicitors like those available here at Gulbenkian Andonian Solicitors.
Civil and Commercial Claims
Civil litigation claims can involve individuals /companies suing or bringing sued on claims involving, for example
- personal injury
- industrial accidents
- intellectual-property claims
- employment claims
Commercial litigation claims are formal means of pursuing legal remedies for damages against another person or company.
The most common types involve:
- contract breaches
- partnership disputes
- director and shareholder disputes
- building disputes.
Let’s discuss some of these in more depth below.
The future of an enterprise can be riding on the success or failure of one partnership. Disagreements between partners significantly affect both staff morale and how others perceive your business, which may affect its reputation in some unforeseen way you never imagined before- affecting everything else.
These disputes can occur during the partnership, or after one partner has left a business or when a company is trading, or after it ceases trading.
Sometimes there is disagreement over how assets should be divided, what intellectual property rights are in dispute, or when customer relationships are used.
When a contract is breached (offer, acceptance, and consideration forming the basis of a contract), it could be, for example, because,
- a party declines to execute their responsibilities that the agreement sets out
- if work carried out is faulty
- if a party fall short of financing for a service or does not pay for services within specified limits
- where there is failure to deliver goods or services
- where services are late without a reasonable excuse
In a breach of contract, the innocent party would have suffered some form of a loss and is entitled to bring claims against the other side.
To prove a breach of contract, you must be able to show [ on the civil balance of probabilities]] that there was an agreement and one party did not fulfill their end.
Director and Shareholder Disputes
There are many varieties of disputes that can arise in business or organization settings. Some will come under the Companies Act 2006, while others could fall into one category within contract law, property rights, etc. – it’s hard to say without knowing more about your specific situation.
Minority shareholders can often find themselves in a difficult position if there is an uneven split of profits between the majority and them. They could potentially challenge the agreement on behalf of or seek more equity from those who hold all voting power, which would increase the risk for both sides involved.
When dealing with partners or clients who have conflicts of interest, it is essential to be transparent and clear about your finances. It will not only keep things on an even keel for everyone involved; you’ll also avoid any potential misunderstandings which could lead down a dangerous path.
How Complex is Commercial Litigation?
There will be several specific issues involved when it comes to commercial disputes, and each one has its precedent. Of course, these precedents do not have match the facts identically, but they can still help determine how a litigation case turns out for you in court.
If circumstances warrant modification or misapplication of an earlier legal principle, then it is up to a judge’s discretion.
It’s a reality that civil and commercial disputes often occur in today’s legal environment in the UK, so you must be ready to deal with such situations in life when they prevail. Moreover, unless you have studied UK law or have an in-depth knowledge of the litigation process, it is not advisable to go at the process alone and to instead instruct a team of legal experts who can represent you as an individual or a company in your plight for justice. This is because these cases can quickly explode, it is important to map out an approach at the start with specific goals ahead of time, so you know what your chances are for success and how best to allocate resources accordingly if need be – even though there may not always actually exist any tangible solution or reconciliation option available depending on who was hurt most by whatever happened between two parties involved here.
Here at Gulbenkian Andonian Solicitors, we specialize in civil and commercial litigation. So if you need an expert team by your side when taking your case forward, our dedicated professionals are the people to call.
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Armen Andonian is the CEO of Solicitors Marketing, a London-based legal marketing agency. He is a legal content marketing expert who writes on UK individual immigration, business immigration, family law, finance, employment law and intellectual property. He has a passion for researching and communicating complex legal concepts and ideas in a clear and engaging manner and has developed a reputation as a highly skilled and versatile author on UK law-related issues. He has written for numerous publications, both online and offline, and his work has been featured in a variety of high-profile media outlets.