Running a business can be a rewarding venture. However, that does not mean that it is immune to legal challenges. Being served with a lawsuit can be a daunting experience, even more so when it involves your business.
In such instances, it is important to respond promptly and appropriately to protect your interests and navigate the complex legal landscape. In this useful guide, we will outline the steps to take when your business is faced with a lawsuit.
1. Understanding the lawsuit
The first and most crucial step when your business gets sued is to understand the nature of the lawsuit. Lawsuits can come from various sources, including customers, employees, partners, or even other businesses. You should carefully review the lawsuit to determine the allegations, claim, and the parties involved. Seek legal counsel to provide professional insights into the lawsuit’s merits and the potential legal implications.
2. Hire a lawyer
Engaging a competent lawyer is essential when your business is faced with a lawsuit. Your lawyer will be your guide through the entire legal process, representing your interests and ensuring you follow the necessary legal procedures. DC Law LLC is a law firm that specialises in commercial litigation in Singapore and can provide experienced lawyers to handle your case.
3. Conduct an internal investigation
To ensure the cost-effectiveness and efficiency of your legal counsel’s guidance, it is advisable to conduct an internal investigation aimed at uncovering all pertinent facts regarding the dispute. This internal investigation should encompass the following:
- Collecting and compiling all relevant documents, contracts, and records related to the lawsuit
- Interviewing individuals who possess knowledge of the facts and summarising their insights
Provide the collated information and documents to your lawyer. This will help you save money because the lawyer will not need to piece the defence together on his own.
4. Submit a Notice of Intent to Contest or Not Contest
Upon receiving an originating claim in a lawsuit, you must file a Notice of Intent to contest or not contest the claim within the specified timeframe (formerly known as “entering appearance”) – generally the deadline is 14 days from the date you were served the court documents. Failure to adhere to this requirement could lead to a default judgment issued against your business.
It is important to note that there are unique situations in which strategically choosing to disregard the originating claim and allowing a default judgment might be preferable. However, this is a decision that should be made thoughtfully and only after obtaining comprehensive legal advice tailored to your business’s specific circumstances.
In essence, when served with an originating claim, your primary course of action should be to seek competent legal counsel immediately.
5. Notify your insurer
If you have business insurance that covers legal claims, it is crucial to notify your insurance provider as soon as possible. Your insurance policy may help cover the legal costs and any potential damages or settlements.
6. Negotiate and mediate
Litigation can be time-consuming and costly. In many cases, it is in the best interests of both parties to explore settlement options through negotiation or mediation. Experienced commercial litigation lawyers or mediators can help to facilitate discussions and reach mutually beneficial agreements.
7. Prepare for trial
If negotiations or mediation fail, and the lawsuit proceeds to trial, your lawyer will help you prepare a strong defence strategy. They will represent your interests in court, presenting evidence and arguments to support your case. A good and competent commercial litigation lawyer will ensure that a strong defence strategy is mapped out from the start, after a thorough assessment of the merits or otherwise of your defence.
Throughout the lawsuit, it is vital to comply with all court orders and deadlines. Failure to do so can result in adverse consequences.
Facing a lawsuit as a business owner in Singapore can be challenging, but with the right guidance and support, you can navigate the legal process successfully. DC Law LLC offers comprehensive legal services to businesses in Singapore, including expert representation and advice in litigation matters. Check out our previous article to learn more about the values we stand for.
By following the steps outlined in this guide and enlisting the services of experienced lawyers, you can protect your business’s interests and minimise the potential impact of a lawsuit. Don’t let legal challenges overwhelm you; take action and secure your business’s future!
For more information, do not hesitate to get in touch with us today.