The Australian Small Business and Family Enterprise Ombudsman has just released its Access to Justice report, detailing where small businesses went to for dispute resolution matters over 2018.
The report found 9 out of 10 businesses attempted to speak with the other party to try and resolve the dispute among themselves in the first instance. For those that then sought advice outside the business relationship, 63 per cent chose to go to a lawyer or other form of legal service. Among them, 41 per cent escalate the matter to a formal dispute resolution process.
Of those who had escalated a serious dispute, 57 per cent had been resolved (29 per cent in favour of the business), the report found. However, 13 per cent of disputes were abandoned mid-process, with the report providing a look into the reasons why.
It found that 49 per cent of respondents who escalated a dispute with their lawyer abandoned it mid-way through due to the costs associated outweighing the potential gains.
A further 24 per cent said they believed they were unlikely to win, while 19 per cent said they “didn’t have time” to take the process all the way.
Twelve per cent said they were advised not to proceed further, while 11 per cent said they either didn’t feel confident they’d get a fair ruling, or they were concerned about their mental and/or physical health.
Seven per cent cited reputational concerns, 4 per cent said they didn’t feel confident that they understood the procedures and a further 4 per cent said they either didn’t want to damage the relationship with the other party, or, were concerned about retribution from the other party.