Commercial disputes are an unfortunate but common reality of doing business. Issues may arise due to contract disagreements, failed partnerships, or a breach of fiduciary duty. 

As of 2025, the cost of a lawsuit could run a business anywhere from $100 to $1,000 per hour, according to Express Legal Funding. Then consider that these lawsuits might go on for months with additional court fees, business valuations, and more. Handling a dispute strategically can save you time and money. 

Here are five contract dispute tactics you can use for the best results. 

What Is a Commercial Dispute?

A commercial dispute is a disagreement between businesses or business entities. These disputes often involve contracts, transactions, or obligations tied to trade, services, or operations. Common examples include:

• Breach of contract claims
• Partnership disputes
• Shareholder conflicts
• Intellectual property disagreements
• Disputes over payment terms or failure to pay rent

Unlike personal disputes, commercial ones tend to involve higher financial stakes and broader consequences. A single unresolved dispute can affect supply chains and regulatory compliance. It could also impact investor confidence in your business. 

You can resolve commercial disputes through various mechanisms. These include negotiation, mediation, and arbitration. At worst, you can choose litigation to force the issue. 

Choosing the right approach depends on the nature of the dispute, the governing contract terms, and the business objectives involved.

What Are the 5 Steps of the Conflict Resolution Process?

There are five important steps to the dispute resolution process. They ensure that you understand how to proceed with addressing the dispute and avoid any mistakes. 

1. Early Assessment and Risk Analysis

Business conflict resolution begins with an assessment of the situation. This involves reviewing factors, such as:

• Contracts
• Correspondence
• Financial records
• Any relevant legal obligations

Early analysis helps determine the strengths and weaknesses of each party’s position and identifies potential exposure. 

At this stage, businesses should consider commercial litigation advice from experienced counsel. Understanding jurisdictional issues, limitation periods, and enforcement risks early can prevent costly mistakes later. Double-check the existing lease for any clarifications or loopholes. 

A realistic evaluation also helps decision-makers avoid pursuing claims that may cost more to litigate than they’re worth. 

2. Clarify Business Objectives

You should not handle all disputes the same way. Some businesses prioritize preserving long-term relationships. Others focus on precedent, confidentiality, or financial recovery. 

Clarifying objectives ensures that the dispute resolution process aligns with broader business goals. 

For example, a company may decide that a quick settlement is preferable to prolonged litigation that could disrupt operations. In other cases, enforcing contractual rights may be necessary to deter future breaches. 

It’s all about determining how big the dispute is and if the benefits outweigh the risks. 

3. Strategic Communication and Settlement Negotiation

Effective settlement negotiation tips are critical to resolving disputes effectively. Open but controlled communication can often lead to resolution before positions harden. This step may involve direct negotiation between parties or structured discussions facilitated by legal counsel. 

Successful negotiation focuses on interests rather than positions. Understanding what the other party needs can open paths to creative solutions. Documenting negotiations carefully also protects against misstatements or admissions they might use later on in litigation. 

Many businesses resolve disputes at this stage, saving significant time and cost. 

4. Alternative Dispute Resolution (ADR)

If negotiations stall, you can try alternative dispute resolution methods. These include mediation or arbitration, which both provide a structured yet flexible solution. 

Mediation allows a neutral third party to facilitate discussions and avoid legal proceedings. Arbitration results in a binding decision without the formality of court proceedings. 

ADR is effective for contract dispute tactics involving technical issues or ongoing business relationships. These processes are faster, more confidential, and less adversarial than litigation. They’re more attractive for businesses that want to remain on good terms with one another. 

However, ADR is not always appropriate. More complex disputes, such as fraud or injunctions, may still require court intervention. 

5. Litigation and Enforcement

When other options fail, commercial litigation becomes necessary. Litigation provides a formal mechanism to enforce rights, obtain damages, or secure injunction relief. Preparation and strategy are critical. 

Businesses should work closely with legal counsel to manage discovery, motion practice, and trial preparation. They can provide commercial litigation advice on things like timing and a potential settlement. 

Frequently Asked Questions

How Long Does It Take to Resolve Commercial Disputes?

The timeline varies. It all depends on the type of conflict, how you go about resolving it, and individual factors. 

Some disputes are resolved in weeks through negotiation. Others can take years if litigation is required. Complexity, jurisdiction, and the willingness of parties to cooperate all play significant roles. 

Are Verbal Agreements Enforceable In Commercial Disputes?

In some cases, yes. However, enforcement depends on jurisdiction, the nature of the agreement, and available evidence.

Written contracts reduce uncertainty and are far easier to enforce. Verbal contracts often complicate matters and are difficult to verify. 

What Role Do Contracts Play In Dispute Resolution?

Contracts often dictate how you can handle disputes. This includes choice of law, venue, and whether arbitration or mediation is required. Reviewing these clauses early is essential. 

For example, a contract may establish that mediation must come before litigation. 

Is Litigation Always More Expensive Than Settlement?

Not always, but it often is. Litigation involves court fees, discovery costs, and significant time commitments. Always assume you’re going to spend more than you’ve budgeted for. 

That said, litigation may prove necessary when settlement demands are unreasonable or rights must be enforced. It could be the only way forward to close a dispute. 

Settle Commercial Disputes With Ease

Commercial disputes are an inevitable part of business, but they don’t have to derail operations or destroy value. Following a structured resolution process can resolve conflicts and protect their interests. Focus on clarifying objectives, negotiating strategically, and litigating only when necessary. 

McKenna, McCausland & Murphy P.A. is the go-to legal resource for retail landlords. We can help you handle anything from dispute resolution to lease enforcement. Our office has handled, in total, over two thousand landlord/tenant cases thus far. 

Reach out with any questions and request a quote online.