A group of leading professional services businesses – including accountants PKF Littlejohn, and law firms Bermans and Moore Blatch – have come together to launch a ground-breaking commercial dispute resolution service for SMEs.
The new process – called Escalate – removes the barriers that currently prevent claimants from pursuing their cases by helping them with their cashflow. Escalate then focusses on achieving a prompt settlement, with fixed fees payable only on a successful outcome and no upfront costs. This contrasts with the traditional commercial dispute resolution process that typically takes 18 months; is often billed by the hour; can require the payment of disbursements, such as court fees or the costs of an expert, upfront; and leaves the claimant at risk from large legal bills from its advisers and exposure to the defendant’s costs in the event of an unsuccessful outcome.
How Escalate plans to transform the dispute resolution market
Escalate is a two-stage process. Firstly, Escalate focuses on a negotiated settlement, using licenced corporate recovery specialists with a track record of rapidly recovering assets to negotiate on behalf of the claimant, and encouraging the defendant to settle quickly in the client’s favour without the need for litigation. The process allows a maximum of three months for this negotiation.
If the defendant is unwilling to settle in this timeframe, solicitors acting on a fully conditional basis will begin preparing for litigation with the back-up of the adverse costs insurance. As part of the service, all fees and associated costs are funded and paid on the client’s behalf all the way up to a High Court resolution, with the adverse costs risk indemnified by an insurance policy.
The founders of the Escalate process are encouraging other leading professional services businesses – particularly legal practices and accountancy firms with corporate recovery teams – to sign up to use the Escalate process.
The Escalate process covers the full range of commercial dispute cases – including bad debt, contractual, and negligence – that SME businesses typically face.
Escalate can take on backdated cases
Importantly, it can tackle cases going back up to three years, enabling businesses to start to recover monies that were previously written off and providing an unexpected cash flow injection.
Escalate partner firms are currently working on a number of cases, including one involving a business that was forced to cease trading two years ago because of an unresolved dispute. Escalate is being used to see if additional funds can be returned to creditors, breaking new ground and potentially opening up a new channel through which insolvency practitioners can recover funds.
Chris Clay, one of the architects of the Escalate process, said: “Many businesses don’t pursue commercial disputes because of high upfront costs, long delays and considerable uncertainty – but there is now another way.
“Escalate was created from a desire to improve the traditional dispute resolution process from the SME client’s perspective.
“We’ve seen considerable demand for Escalate and are keen to work with more law firms and corporate recovery teams to allow Escalate to continue to grow. Any forward thinking professional services business can get involved in this exciting new project and we’d invite them to get in contact.”
Nick Harvey, a partner at Bermans LLP, said: “Pursuing a commercial dispute has tended to be a costly, lengthy and risky undertaking. It’s hardly surprising, then, that many businesses decide against making a claim and reluctantly write-off what they are owed.
“Escalate is a smarter way for businesses to resolve commercial disputes: there’s no financial risk in that clients don’t pay out unless they reach a successful recovery; there’s no pressure on cashflow as we’ve removed all of the upfront costs; the fees are fixed and clear from the start; and we’re confident we can achieve early and good outcomes for clients in most cases.
“The term ‘disrupter’ is over-used in professional services, but I have no doubt that the Escalate process has the potential to transform how disputes are resolved.”
< News & Views
Contact Us to find out more about how Escalate can help your business.
Exchange Station, Tithebarn Street, Liverpool,
L2 2QP (Registered office)
London office: 5th floor, 15 Westferry Circus, London, E14 4HD
Escalate Law Limited
Company No: 10381993
Authorised and regulated by the Solicitors Regulation Authority
Escalate Law Limited (No: 650666)