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Leading lawyer is urging businesses to avoid shelving potential claims during pandemic

A leading lawyer is urging businesses to avoid shelving potential claims during the Covid-19 pandemic.

As businesses are fighting the economic downturn caused by the pandemic, they could be avoiding making claims in the short term, meaning potentially successful cases are being abandoned and vital cash lost.

Leading lawyer is urging businesses to avoid shelving potential claims during pandemic

Now a leading dispute resolution lawyer and partner at Midlands law firm Wright Hassall, Gemma Carson, is urging businesses to face these situations head-on or risk losing out.

She said: “Many businesses are shelving potentially good claims as a result of cash poor balance sheets with money being diverted to other areas of the business, but at a time when companies need more funds, there are other options that can be particularly successful.

“One of our clients, an SME, has been able to pursue a claim of over £250,000 on a cost-and risk-free basis through the use of a third-party funder and insurance which ensures they pay nothing if the case is lost.

“If successful, this will help bring vital funds to the business without risking cash that could be invested elsewhere, which is something all businesses should be employing to help bring in additional money during these financially difficult times.

“One thing that is routinely missed is that businesses do not need to use their own cash to pursue claims. Instead they can use the funds of a third party to pursue it and in return, the third-party funder takes a cut of the balance recovered. 

“This offers a no-risk solution to pursue claims as the third party chooses to invest in your claim, rather than the business risking diverting money from elsewhere, which reduces the overall sum received but still regularly results in success.

“While starting court action against a business that genuinely has no cash to pay does not make commercial sense; however, in an environment where businesses will now be prioritising those creditors who ‘shout loudest’, prompt action is critical.

“Despite issues with cash flow, many businesses will be insured and so these claims need to be pursued as soon as possible.”

For more information, visit https://www.wrighthassall.co.uk/knowledge-base/pursuing-claims-when-your-business-is-cash-poor 

Pictured: Gemma Carson

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