Recession sees increase in commercial disputes

Date: 23rd September 2008

Commercial disputes between small businesses and larger firms have risen dramatically in the face of recession.

That is the conclusion of a study revealed by the Law Society yesterday (September 22nd), which shows that companies are increasingly scrutinising contracts to ensure they have been complied with.

According to the Law Society, small firms are particularly at risk as larger companies look to impose stricter contract terms.

Paul Marsh, president of the Law Society, said: "Larger companies are taking a tougher line over the terms of contracts they have with smaller suppliers and customers.

"They might look to extend the period by which payments are to their smaller suppliers are made. Smaller companies might fear challenging them in case they lose favour and their contract."

He adds that going through the courts to settle disputes is often unavoidable, but business managers should consult a solicitor or accountant beforehand.

Research published earlier this month showed that small businessmen contribute over £1 billion to the UK economy.