According to recent statistics, owners of small and medium businesses are avoiding instructing solicitors. Commercial solicitor Alistair Gregory examines this phenomenon and asks what can be done to address this problem.
I must admit to being a tad puzzled by the news that small and medium businesses (SMEs) are reluctant to instruct solicitors in legal disputes. According to the Legal Services Board (LSB), only 12 per cent of such disputes result in an external solicitor being instructed – yet 45 per cent of these companies say that legal wranglings had a ‘tangible effect on their company’, including loss of income or loss of reputation.
So what’s going on?
The good news for lawyers is that this reluctance is likely not a reflection on them personally – in my experience at least, we commercial solicitors make for very engaging company! Instead, as is often the case, the answer lies in the numbers.
Only 12 per cent of the companies polled by the LSB thought that lawyers provided ‘a cost-effective means to resolving legal disputes’. This is understandable considering the considerable sums of money often involved in complex, time-consuming commercial cases. A legal dispute is very rarely accounted for in any company’s financial plan, so when money is tight a specialist solicitor may seem like a luxury rather than a necessity.
However, in my experience the services of a legal expert can be invaluable in bringing about a satisfactory outcome – particularly for SMEs, where the very future of the business can be at stake.
The onus, therefore, lies with us – the lawyers – to find a way for SMEs to get the representation and advice they need without the inflexible hourly rates and funding options.
If you are a small-medium business owner, there are a range of litigation funding options available to you, helping to spread the risk of fighting a legal dispute and provide financial certainty for your organisation.
To better understand your options, speak to one of our commercial solicitors on 0175 321 6399, or complete our online enquiry form, for more information.