Dispute Resolution In the UAE | Litigation Is Not The Only Way

Posted on Mar 19, 2012 in Emirates-Middle East, UAE Law and Business

When companies enter into a business transaction – be it trading of goods or leasing of a commercial property – everything seems to be in control, as it should be. However, unfortunately, sometimes it does not take long for the good business relations to turn sour, the reasons of which can be many – cash flow problems, bad faith of a party, or any other reason beyond the control of the parties. And, then more often than not starts the beginning of a long drawn-out and expensive litigation battle which may end up poisoning the relationship between the parties and ultimately profits.

Fire first, aim later?

The Dubai Courts caseload has increased by 60 percent since 2008, according to a report that was released in 2011 and this increase is probably the effects of economic downturn. It is important to note, however, that litigation is not the only way to resolve a dispute. It is sometimes said, quite often correctly, that litigation can be a time consuming, costly and unsatisfactory way of resolving disputes between two contracting parties.  If the parties are willing to exchange information and negotiate, disputes can be settled in a cheaper and quicker manner. Many lawyers, including those who practice in the areas of debt recovery, property, and workplace disputes will agree that majority of disputes can be settled amicably before a claim is filed in a court. There is no point in “firing first and aiming later” – in other words, filing a lawsuit without considering settlement options to amicably resolve a dispute.

Alternative Dispute Resolution

In legal terminology, any mechanism for the resolution of a dispute which does not involve court proceedings is called Alternative Dispute Resolution (ADR). ADR can range from informal negotiations between the parties to more formal processes such as arbitration, and can offer companies numerous advantages including time and cost savings, and the maintenance of ongoing business relationships. In these challenging economic times, litigation may be the last thing the parties to a contract want or need.  ADR offers contracting parties a means by which they can resolve their disputes quickly and efficiently without the need to get bogged down in time consuming and expensive proceedings.

Build a Strategy

Diaz Reus has significant experience in dealing with complex contractual and commercial disputes in Latin America, Asia, the Middle East, Europe and the United States. We offer strategy and execution in resolving commercial business disputes. We know first hand that aiming before firing is the best way to hit your target.


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