Getting “Access to Justice” in Commercial Disputes

What is “Access to Justice” in a Commercial Dispute?

 

Many lawyers, when they speak about “access to justice”, seem to confine this question and issue to meaning just one thing – access to the legal justice system. That is, access the courts and tribunals of the land.

 

Courts and Tribunals are what you might call the “formal” justice system. The formal justice system provides a system and set of rules for making decisions and determinations (called adjudication) in disputes where the disputants are not able to do this for themselves outside of the formal justice system.

 

The formal justice adjudication system must necessarily apply a set of legal and evidentiary rules to determine who is right or wrong in a dispute.

 

The formal adjudication system is necessarily complex, cumbersome and expensive, and because of this it restricts access to justice to those that have the means and the desire to use this system to his, her or its advantage.

 

Because of this, and the inequalities that exist within the formal justice system, there is an increasing trend to seek “informal justice” via avenues and processes outside of the formal justice system.

 

This is where “ADR” ( alternative dispute management/resolution or appropriate dispute management/resolution) plays an increasingly important role in our society.

 

The foundation for the movement in this direction comes recognising and accepting the limitations of the formal justice system to deliver “access to justice”.

 

Consider this recent statement from the Hon. Michael Kirby AC, CMG (former Justice of the High Court of Australia) –

 

“The fact is that most ordinary citizens cannot afford to litigate a civil case in court today. Becoming involved in such litigation is a nightmare.

 

In certain circumstances, the handing down of a binding decision by an external third party best serves the interests of justice and finality.

 

Few disputants are as intensely interested in the elaboration of the law or the principles of justice as some lawyers are. Few find the intricacies of the law as fascinating as lawyers do. Most simply want a resolution of their dispute, particularly if they are commercial people deriving income for shareholders or ordinary citizens of limited means.”

 

In a similar vein the Hon. John Doyle AC QC (former Chief Justice of the Supreme Court in South Australia) said –

 

“The existing system for commercial litigation does not deliver effective justice. Even cases of modest length and complexity routinely take two to three years or more to come to trial. For parties engaged in a business, this is almost always too long.”

 

He later said –

 

“I conclude that no only is the duration of cases a problem in the area of commercial litigation, but further that a lot of the activity that goes or adds to the delay and costs, and in the end is found to have contributed little or nothing to the efficient and just disposition of the case. This is a serious problem.”

 

Highly trained and skilled people in the art of alternative ways to manage and resolve disputes outside of the formal justice system are able to deliver efficient and just disposition of disputes by establishing an informal model and set of strategies to work with those involved in a commercial dispute in a cooperative, collaborative and creative way.

 

Disputes that could take 2 years or more in the formal justice system to reach a final decision by a court or tribunal, and cost each party very large sums in legal costs and a great deal of unwanted stress and upheaval in their personal and business lives, can be resolved using ADR techniques within 4-6 weeks, at a fraction of the cost and without inflicting hurt and damage on those involved in the dispute.

 

How is this done?

 

Please refer to the many articles on this blog that provide specific details on how ADR can be effectively and efficiently applied to the management and early resolution of commercial disputes.

 

In their submission to the Productivity Commission’s Inquiry into Access to Justice in the federal civil justice system, the Small Business Development Corporation in Western Australia made some valuable observations based on their extensive research in small business sector of that State (which is replicated in all other States).

 

Some of the insights they included in their submission –

 

  • Small business owners generally seek assistance from outside sources when they are already in trouble. It is rare for a small business owner to seek assistance to prevent issues from escalating.
  • Small business owners often do not properly understand contracts that they enter into, failing to properly realise the ramifications of the terms and conditions they have signed off on.
  • Small businesses are poorly equipped to establish and spend time securing business systems and reviewing business processes that would help prevent problems occurring.

 

These types of behaviours that are rampant amongst small business owners are what are called risk behaviours that increase the chance of disputes occurring and putting such businesses at risk of becoming a victim of litigation hijack (see my other blog posts about litigation hijack).

 

Surveys of small business owners as to why they don’t seek legal assistance at an earlier point of time is because they feel that they cannot afford such legal assistance. They fear that they might not get a good return on their expenditure on legal fees. So they try to work things out on their own as best they can.

 

A major criticism of lawyers is this – “Lawyers charge far too much and do not guarantee that they will achieve the desired result; Legal and time costs would outweigh any positive results.”

 

ADR experts managing and resolving commercial disputes tackle these issues head on via a combination of ways and strategies, including –

 

  • Using “triage” to create a blueprint for the dispute that will ensure a return on investment for those involved in the dispute;
  • Offering quick and low costs ways to remove roadblocks or impasses as part of the overall dispute management;
  • Opening up options and possibilities for the parties to resolve their dispute quickly and at lowest possible cost that can only become possible when working with the parties in a cooperative and creative way;
  • Helping those involved in the dispute to keep their commercial goals and interests in the forefront of their minds during the dispute management process and avoid them being submerged or distorted by over emphasis on legal rights and positions that will ultimately depend on some judicial ruling by a court or tribunal.

 

One of the biggest obstacles to business owners gaining early access to ADR expertise and assistance is their lack of awareness of its existence and availability to them. In many cases this is a tragedy as business owners get sucked into litigious ways to resolve their disputes when it was avoidable and they could have been spared the nightmare that followed once they became enmeshed in the formal justice system.

 

Publishing articles like this one and the many others on this blog is one way to help increase awareness of the alternatives so that business owners can make better decisions and make them at the time those decisions need to be made.

 

 

Christopher Whitelaw

Principal and Director of the Commercial Disputes Management Centre.