Business start-up - professional negligence
This matter related to the funding of a business start-up and allegations of wrongdoing by business advisors, with the result that the business had failed to obtain the necessary financial support.
Some years after the initial events, and against the background of litigation and other failed attempts to achieve a resolution, the issues were addressed at mediation. The shareholders and directors of the business had a number of financial claims including loss of salary, loss of a capital asset and expenses. There were complex issues about whether or not fault could be established on the part of the advisors and, in any event, what the outcome for the business would have been even if funding had been obtained.
In reaching a resolution, the parties avoided the prospect of more years of litigation and the costly expenditure of time and effort which would have distracted them from the future development of business.
In a series of meetings facilitated by a mediator, the parties sought to articulate and refine the issues between them. The strength of the legal cases and the potential value of the business, had it been successful, were explored by taking the views of lawyers and accountants. These views were then taken into account in assessing the likelihood of success on each side. As a result of this process of risk analysis, the parties were able to find common ground which allowed them to arrive at a result acceptable to both sides.
This was achieved in private, in a co-operative manner throughout and, reflecting the many layers of the dispute, in a period of months from start to finish.
The cost to each side (in financial and non-financial terms) of the mediation process itself was relatively small compared with the alternatives that were available. The parties acknowledged that, without the mediation process, they would not have achieved such an outcome.