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LPC Law Notes Commercial Dispute Resolution Notes

Unit 9 – Tactics In Commercial Disputes Notes

Updated Unit 9 – Tactics In Commercial Disputes Notes

Commercial Dispute Resolution Notes

Commercial Dispute Resolution

Approximately 305 pages

A collection of the best Commercial Dispute Resolution notes the director of Oxbridge Notes (an Oxford law graduate) could find after combing through dozens of LPC samples from outstanding students with the highest results in England and carefully evaluating each on accuracy, formatting, logical structure, spelling/grammar, conciseness and "wow-factor". In short these are what we believe to be the strongest set of Commercial Dispute Resolution notes available in the UK this year. This collection ...

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Unit 9 – Consolidation CDR

Disadvantages of litigation against a debtor:

  • Time consuming – debtor can stall entry of judgement (14 days from CF to file ack then they get 20 days from CF for defence – you then have to apply to strike out defence or summary judgement – could take weeks)

  • Costs unlikely to be recovered in full – costs for CF/interim app/sol costs ALL unlikely to be paid in full

  • Entering judgement does not guarantee payment – judgement can affect D credit rating but many D will still ignore

  • Judgements can be ignored

  • May need to take steps to enforce judgement – more time and costs

  • Litigation stayed if debtor becomes bankrupt/is wound up – client ranks as ‘unsecured creditor’

  • If D owns a property, judgement can be enforced by obtaining a charging order which would mean C is a secured creditor

PREP TASK:

  1. Clause 7.1/2 has been breached

  • potential breach of clause 6 – not putting notice on invoice

  • Lancashire can check Pipers b/a – clause 19

  1. What client is liable to pay under factoring agreement

- pay the money (160,000)to Piper with interest 5% over base

  1. What step scan Lancashire Capital Plc take in relation to alleged debt

  • Commence a debt action – CF followed by summary judgement – Piper no reasonable chance of defending CPR 24.2

  • Enforce their security – COR 8 (fixed over business premises/floating over debtors/stock)

  • Petition for winding up

  • Terminate the contract (Clause 17.2.1.)

4. Further info needed from client

- Has the money been paid by Stockport to Piper

- Had Lancashire previously been offered the debt

- Did they stick notices on the invoices

- Financial situation of Piper (debts)

- What do Lancashire have security over

OUTCOME 1 – procedural and tactical steps possible and why takes them

D can pay but is stalling for time D can’t pay full amount D doesn’t think they owe full amount and will resist paying D is overdrawn but director of D co gave personal guarantee
Advice to C

Corporate insolvency

Undisputed amount of 750 or more, Piper will WANT to pay, they wont they bad publicity/potential of going insolvent if they owe other creditors/might make it difficult for them to trade/Insolvency procedure takes time and costs money

CF + Summary judgement

No defence with real prospect of success, C gets a quick judgement, can take enforcement action and become a secured creditor

Don’t want to do use corporate insolvency as will tell other creditors that D doesn’t have enough money to pay everyone

CF + interim payment

Disputed debt but at least 750 undisputed, best option to try and get some money while D and C argue/go to trial over full amount due

(no reason not to go for summary judgement at same time as procedure and time limits are the same)

Personal insolvency

D must have some assets otherwise you wouldn’t have accepted the guarantee
Advice to D Pay the debt now before a winding up petition is issued Attempt to negotiate with creditor Negotiate over the amount due We can’t advise D personally as we represent company (O3.5 conflict of interest) tell the director to go and get independent advice

OUTCOME 2 – grounds for interim apps

Interim App Strike out statement of case CF +Summary Judgement CF + Interim Payment Security for costs (D only!)
When should it be used When there isn’t any legal basis for the other party’s case When the opposing parties case isn’t very strong When you want to force D to make an early payment of damages When D is worries that C will not be able to pay costs
Grounds

CPR 3.4 – strike out statement of case on grounds that:

1. it discloses no reasonable grounds for bringing/defending claim

2. it abuses courts process

CPR 24-

Claim has no real prospect of success 24.2(a)(i)

Defence has no real prospect 24.2(a)(ii)

CPR 25.7

- D admitted liability to pay damages; or

- C has obtained judgement against D for damages to be assessed; or

- C would obtain judgement of a substantial amount of money if went to trial

Court must be satisfied that it is just to make such an order, plus one of the CPR 25.13(2) grounds:

1. C is resident outside of the EU (company or individual)

2. C is a company and there is reason to believe that it will be unable to pay D costs if ordered to do so

Must provide detailed breakdown of costs incurred to date and those likely to be incurred

Procedure

1. Try to resolve with other side first OO
2. Serve N244 with WS (CPR 24.7) on party at least 3 days before hearing (CPR 23.7(1) – unless other time limits given

CPR 24.2 -

- (1)(a) D has to file ack of service or defence

- 24.4(3) C must give 14 days notice of hearing +issue to be decided

- 24.5(1) D can serve evidence at least 7 days before hearing

- 24.5(2) C can serve response at least 3 days before hearing

- CPR 25.6(3) app notice and evidence served at least 14 days before hearing

- CPR 25.6(4) D may serve written evidence in response at least 7 days before hearing

- CPR 25.6(5) C respond by written evidence before hearing

C must provide

- Bank guarantee

- Pay money into court

- Pay money into joint account held by parties sol
Other

Adv

- Early end to proceedings saves time and costs

Risks:

- Could may allow opposing part to amend it statement of case

Adv:

- Enforce judgement over premises + turn into a secured creditor

Risks to C:

- Other creditor may start insolvency, litigation will then be stayed

D may not have any assets

Can it be obtained where claim for unspecified damages?

Yes – judgement would be for damages to be assessed

- Damages enquiry where court assess amount to be paid by D

Interim payments How much might D be ordered to pay?

- CPR 25.7(4)

- No more than a reasonable proportion of likely final judgement taking into account contributory negligence and any set off or counterclaim that would reduce the amount

- Usually 60% of the lowest estimate of damages

- trial judge will not find out about interim payments until issues of liability and quantum resolved r29.5

What if C awarded...

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