Resolving complaints and preventing drawn out disputes

Given the difficulties faced by businesses coping with pandemic economics, juggling remote workers, skeleton crews and reduced output through social distancing, it is possible that even the best of performers will receive complaints from their customers or supply chain partners.

Managing any work at all is to be applauded and for businesses with a good reputation, any complaint in the current crisis might understandably cause upset and feel like an unwarranted attack. There may also be a suspicion a complaint is being used as a tactic to avoid or delay payment.

It’s only human nature for a business owner or manager to take things personally, while most won’t resort to a telephone shouting match, though it has been known to happen, it is far easier to be guilty of firing off an angry email without properly thinking through the chain of events that this is likely to trigger.

Not only is this potentially bad customer service, but it could make things even worse for your business. A hasty response can focus minds and communications on rights and wrongs or mistakes and failures as you and your (now soon to be former) business partners or customer starts pointing fingers.

This is the opposite of what you want and will form a particularly damaging distraction right now as you seek to navigate away from risks and towards opportunities in the constantly shifting landscape of the post pandemic economy.

So what should you do when you receive a complaint?

  1. Consider its merits: if it is justified you should treat it as an opportunity to proactively get things right and strengthen your commercial relationship before contracts are questioned. If it is not justified, you know that this is going to be a relationship management exercise.
  2. Don’t respond immediately: It is natural to feel upset after receiving a complaint. None of us like to be told we are in the wrong. If you are in the wrong, you feel embarrassed. If you are in the right you feel justifiable outrage. Either is not the best mindset for reaching a practical resolution. Deep down, you always know this is something best dealt with by a clear head.
  3. Write Down Your Response: use your preferred medium, whether it is a letter or an email. Once it is done, do not send it. Put it in a draw or store it in drafts and walk away.
  4. Let Time Pass and Calm Down: once you have returned to your daily zen read through your response. Now that you have had some time to process the complaint, you have probably got more information at your finger-tips. Does the response still ring true given what you now know? Is there more to this than your initial gut reaction?
  5. Check the Commercial Service Agreement: you know it inside out, we know, but before you commit yourself to a position it is always good to let the hard copy infuse you with fortitude. Sometimes, just reading the words can help you to see something new or allow you to better craft a response by including a little quotation. Sometimes, you will notice a sub-clause that you had forgotten. Over time, being systematic in these responses will let you deal with complaints (wherever they may arise) in a more consistent, accurate and focused manner.
  6. Send your response: Waiting is important, but do not wait too long. Time waits for no-one and an unanswered complaint can escalate quickly if the complainer feels strongly about it, which in our experience they almost always do.

If your rational, articulate and well thought out response does not placate the complainer then despite your best efforts, and flawless technique, it looks like things are set for a serious turn. In these situations information retention can often be key to the outcome, so make sure you retain everything pertinent to the complaint, including documents, correspondence, products, packaging etc.

Dispute resolution through early intervention

Early intervention utilising collaborative methods of dispute resolution like mediation, conciliation and negotiation should always be considered in any dispute. Used properly these can often achieve a quicker and more commercially satisfactory outcome than can be achieved through a more formal dispute resolution forum like the courts or arbitration.

Disputes can often be resolved more quickly this way and the costs of dealing with a dispute can be lower than traditional court proceedings. Collaboration also offers more flexibility and commercially focused resolutions, typically allowing the parties to preserve their relationships.

Importantly for most businesses there is no airing of dirty laundry in public, with a confidential resolution process that is not only beneficial, but often mandatory. These collaborative approaches to resolution do not exclude other methods of dispute resolution and can be used in conjunction or in parallel to more formal forums (i.e. the court or arbitral tribunal).

It is to your benefit to take legal advice early

Talking to legal advisers does not necessarily escalate a dispute and can often mean a simple resolution without a tense legal battle. Experienced lawyers are able to concentrate on diffusing any disputes and preserving the commercial relationships to the benefit of both parties.

It can also help you to avoid turning a commercial dispute into something far more damaging. For instance, a hot-headed response and suspension of service provision or product deliveries may make you feel better, but could cause a serious breach of contract, the instigation of injunctive proceedings, a claim for damages against you and a termination of a key commercial contract.

Lawyers are paid by you to understand and advise you of the consequences before you take steps to cause a chain reaction that will not be to your benefit.

If a resolution cannot be achieved, despite your best overtures and you still feel the complaint is unjustified or tactical and legal proceedings appear the only option, choose lawyers experienced in commercial disputes, who are committed to delivering a commercial and cost-effective resolution rather than winning at all costs.

If you would like further advice on a current dispute, or on dispute resolution clauses in contracts prior to a new commercial relationship, please contact our Director Matthew Clark on +44 20 8014 0808 or email him at matthewclark@cardiumlaw.com