I have just attended the Online Dispute Forum in Liverpool where key note speaker Richard Susskind gave a great deal of emphasis to the concept of Litigation Avoidance and the challenge to build dispute resolution systems for avoiding problems in the first place.
Against this background, consider this article in the Telegraph about serial entrepreneur, Chris Gorman who was involved in 2006 in a high profile litigation pertaining to the company, Gadget Shop.
"A year on, the Gadget Shop wounds aren't quite so raw. Gorman and business partner Tom Hunter were accused in the High Court of "stealing" the Birthdays card and gift shop chain from under the noses of fellow Gadget shareholders, UBS trader Jon Wood and Peter Wilkinson, by buying it for themselves.
They won the case but none of the four emerged with much credit from a public ordeal which, like the business relationship between the four, descended into an unedifying spectacle of personal mud-slinging. Accusations of heavy boozing, table-top dancing in Mediterranean resorts and grown men crying in board meetings made the case a great spectacle but a bruising personal experience for those concerned......."
and
"Actually Gorman has two regrets about the whole affair. With hindsight an early fractious board meeting should have told him all he needed to know about his relationship with his business partners. "I made a mistake not recognising the signs early on and just walking away. I should have realised it's never going to work if you can fall out that badly with people. It was very messy."
His second regret is the enormous cost of washing dirty linen in the High Court. "At the time of the court case I was organizing the Live8 concert in Edinburgh. My biggest frustration was that there was £10m costs between the four parties. No one gained anything from it. Think what the money could have done for charity."
Some points:
Do not get me wrong. Litigation is and for the foreseeable future will be a necessary step for many firms but it should be a point of last resort than a 1st point of call. The key question to ask here is whether there was an alternative to litigation.( I think Gorman indicates there was.)
One of the real problem of litigation is that it is often a public forum and can as it has been in this case, damaging from a PR perspective.
Are lawyers really ready to embrace litigation avoidance? I wonder if the lawyers most likely to see the benefits of this will be the in-house lawyers who may be more aligned to the commercial needs of their firm than those lawyers in private practice.