Business disputes between legal entities

The specificity of economic disputes between legal entities is the equality and independence of the parties from each other. Their relations are regulated by contracts that can be drawn up on the basis of mutual trust and simply do not foresee force majeure moments that occur in wartime. That is why the law firm “DE-JURE” advises to sign up for a lawyer’s consultation at the stage of concluding the contract in order to avoid disputes and misinterpretations in the event of a conflict. And if there is a need to support economic disputes in court, our lawyers from economic services will help protect the rights and interests of the client.

What are the economic disputes between legal entities?

During their activities, legal entities enter into legal relations that include everything related to economic activity: supply contracts, the provision of various services, transportation of goods, ordering products, etc. Thus, disputes arise on the grounds of:

• non-fulfillment or improper fulfillment of the terms of the contract;
• violation of the terms of fulfillment of the terms of the contract;
• delay in payment;
• improper quality of goods and services;
• lease of land from the state or other legal entities (agricultural plots, reservoirs, subsoil, forests);
• bankruptcy, the issue of liquidation and reorganization of legal entities – arises not from the contract, but when the enterprise for any reason ceases its activities (by its own decision or at the request of creditors to whom it owes a certain amount of money). The decision to terminate the enterprise’s activities can be made by the court. Then an arbitration manager is appointed, who assumes the functions of the manager and is engaged in the sale of property, repayment of debts.

A separate category of business disputes concerns property issues between enterprises: non-residential real estate, land plots, industrial facilities. These objects could have been obtained by a legal entity through privatization, purchase from the state or a private owner, and a dispute arises between which enterprise is the legal owner and which received the object in violation of land and property rights. Such situations can be prevented if you order a pre-purchase real estate inspection service from the company “DE-JURE” in advance. The lawyer checks the property that is planned for purchase for problems: are there any ongoing legal disputes, criminal proceedings against previous owners, are there any arrests, demands to cancel previously conducted property transactions, demands from previous owners who received the property as a result of illegal transactions. As a result, the client receives a legal opinion on how risky it is to purchase this asset.

How is the consultation on economic disputes between legal entities carried out?

During the consultation on economic disputes, the lawyer gets acquainted with the circumstances of the case and studies the legal documents of both enterprises: the Charter, regulations, decisions of the management bodies and the actual agreement between economic entities, which is the cause of the dispute. He also examines the documents that confirm or deny the execution of the agreement: receipts, invoices, acceptance and transfer certificates, payment documents, and on this basis makes a legal conclusion about the prospects of a lawsuit, based on the terms of the agreement and current legislation.
If the terms are not clearly spelled out in the agreement or it contradicts the norms of the law due to the fact that the economic entities are not legally literate and made errors in the wording, the strength of the position and the prospects of filing a claim or defense in court are determined.

What documents must be provided for consultation on economic disputes between legal entities?

To resolve conflicts between legal entities, a lawyer must study both the legal documents of the enterprises, the contract whose terms were violated, and the evidence of the violation provided by the client (invoices, payment statements, etc.). Legal entities often underestimate the importance of the contract. Some terms are not prescribed, and in the event of a dispute, it turns out that the description of the goods, its quality, packaging, delivery time, delivery methods, etc. are written out unclearly and penalties cannot be applied to the violator, and compensation for damages must be sought through the court. And the court is guided not only by the contract, but also by the law. It interprets the case in accordance with justice, practice, and judicial norms. Therefore, a properly drawn up contract can prevent a dispute or contribute to a quick resolution of the problem.

What services does support for commercial disputes include?

A significant violation of the terms of the contract leads to a commercial dispute, which can be resolved in court or without the participation of the court through mediation. In both of these ways, the client can count on legal assistance in commercial disputes from a lawyer from DE-JURE, whose responsibilities include:

• consulting and studying documents on disputes over the provision of services or goods;
• legal assessment and examination of documents;
• legal assessment and examination of the situation;
• claim and lawsuit work: if the situation is not resolved in the claim procedure, then preparation of a claim in commercial disputes;
  legal representation in commercial disputes until the decision is made and then until its actual execution (receipt of money or an obligation to properly fulfill the terms of the contract).

Mediation in commercial disputes is used when both parties are interested in finding a common solution and plan to continue business relations in the future. Lawyers representing the interests of the parties reach a consensus through discussion, and the parties can raise issues not specified in the contract and resolve the problem on favorable terms. The mediation service is also provided by the DE-JURE company within the scope of claim-law work.

If one of the counterparties in a dispute between enterprises regarding services and goods belongs to a foreign jurisdiction, then you can apply to both the national economic court of another country and international arbitration to resolve the economic dispute. Usually, in such cases, the documents specify in advance where to file a lawsuit for breach of contract. A DE-JURE lawyer will help prepare documents for arbitration and will interact with a lawyer abroad.

What results can be expected from legal support of business disputes between legal entities?

It is unlikely to resolve a business dispute between legal entities without the help of a lawyer. There are many rules and requirements of the law, procedural norms, formal requirements for the execution of documents, types and forms of documents. Without professional legal support, it is extremely difficult for an ordinary person representing a legal entity to independently navigate all these nuances and, even more so, to correctly substantiate their position in court.

The result of legal assistance in a business dispute about property rights, fulfillment of the terms of the contract, etc. is the resolution of the client’s request. It includes a legal opinion on the prospects for protecting the rights of the legal entity in court. By court decision, the client either receives compensation for losses or will be deprived of claims from the counterparty. When one of the enterprises violates the terms of the contract, it voluntarily agrees to pay penalties provided for by the contract or law. For example, if the payment terms are violated, then a sanction of 3% per annum comes into effect. That is, conditionally, for each day of non-payment, the amount increases slightly. When it comes to non-monetary issues, the offending party is also obliged to compensate for losses – in particular, compensation for unearned benefits can be demanded through the court or restoration of business reputation that was damaged due to the actions of another enterprise.