If you want peace, you may need to threaten war!
I did a blog a few weeks ago about how clients often say they want simple contracts, and not War and Peace, to which I always reply that that’s fine, but if it means leaving out important things, you may find that you’d have been better off not bothering with the cost of an agreement at all, and just save your money to deal with the dispute if one arises.
It turns out that I was right!
In a recent case, a defendant tried to enforce a dispute resolution clause, against a claimant who had issued proceedings (at the last minute to avoid being time barred), without having gone through any dispute resolution first. In reality, the Defendant was hoping that if they were successful, the claim would be struck out and then the claimant would be time barred – game over!
However, the Defendant’s biggest problem was the poorly worded dispute resolution clause – the court found that it wasn’t sufficiently detailed and so wasn’t enforceable. If a clause is too brief or too vague, it is unlikely to be able to be enforced as the court won’t know what it is that it’s enforcing.
In any event, the court said that even if the clause had been enforceable, it would simply have stayed the court proceedings pending the outcome of the dispute resolution process. So, the claimants were right to have issued the proceedings in the first place.
Of course, all of this could have been avoided if the contract had been more detailed!
Kleyman & Co Solicitors. The full service law firm. The devil isn’t always in the detail.