Considering Litigation in India | Part IV

This article is in continuation of the earlier articles that discuss various aspects one must bear in mind while seeking to litigate before courts in India. As outlined in the earlier article, it is imperative for a business to anticipate a dispute well in advance and plan the best approach for it. That said; the facts of a dispute are pivotal to formulate any kind of legal strategy. But, facts are like a double-edged sword, which can swing either way, i.e. it can either make or break your case, depending on whether the facts are favorable or unfavorable. Therefore, a favorable fact pattern supported with relevant documentary evidence can enhance the chances of securing the desired relief from a litigation process. It places the counsels in a position of strength to effectively thwart any attempts by opposing counsel to dilute a case. However, challenges arise where one has weak or unfavorable facts and little or no proof to support the merits of their claim. In such situations, the importance of engaging with advisors early in the day cannot be stressed enough. Counsels and advisors having the requisite expertise in specialized commercial disputes can aid in crafting an approach that could help in strengthening the merits of the case.

There are certain guidelines that one needs to understand while engaging with counsels for a potential dispute scenario. As always, these are not exhaustive guidelines but indicative in nature.

Attorney-client privilege

For any business approaching a counsel, it is important to understand the concept of an attorney-client privilege. An attorney is under a moral obligation to maintain their client’s confidentiality. Under no circumstances can an attorney disclose any communication or information to any third person without the consent of their client. At first, a client may be apprehensive to share accurate facts of the anticipated dispute. But the client must understand the rationale behind disclosing all facts to their counsel. Any dispute resolution would involve the application of the law to the facts of the client’s case. Therefore, it is important to cultivate a strong attorney-client relationship based on trust, that will allow a client to disclose all details honestly. Counsels can formulate the most effective future course of action once they are equipped with all facts.

Full and fair disclosure of facts

Sometimes, assuming that it would make the process of dispute resolution smoother and hassle free, a client may disclose only those facts to their counsel which they think are of material importance. However, in the nascent stage of the dispute, it is almost impossible to ascertain as to what information could be important at which juncture of the dispute. Therefore, a client must fully and fairly disclose all facts to their counsel, irrespective of whether they consider it material or immaterial.

Materiality of a fact is the prerogative of the counsel and not for the client to decide beforehand. While the end goal may be to achieve a settlement, it is not necessary that one may achieve what they desire. If the dispute reaches court, the counsel would be in a tough spot where an opponent presents information which a counsel is unaware of. The counsel would have no ready defense to counter those claims raised by the opponent. Hence, it is crucial that a client discloses all facts to their counsel, even if the facts might be weak or unfavorable. Any concealment would adversely affect the counsel’s ability to control the proceedings.

Plan of action based on facts

Approaching advisors early in the day will enable them to plan a long-term strategy to achieve a favorable settlement. They could also formulate a short-term strategy to extract valuable admissions from the other side in the pre-litigation stage. This is useful especially in the absence of strong or favorable facts.

Controlling the fact pattern

Usually, before a client approaches a counsel to seek advice, the parties have already exchanged various statements by emails, written communications, SMS, WhatsApp etc. Each of these can become valuable inputs in building a strong case in a future litigation. Commercial litigation essentially revolves around the documentary evidence that can be brought to the table and of course the skill of the counsel involved. But the best of counsels cannot undo poor paperwork or explicit documentary evidence that weakens a client’s case. In this context, one must bear in mind that all forms of electronic communication are also a form of evidence that can be used in support of a case. Hence, foreseeing a dispute well in advance will allow a client to calibrate their responses, in consultation with counsel, while communicating with the opponent. The valuable submissions made on record by the unsuspecting opponent could become essential facts / evidence in the dispute, placing the other side at a significant disadvantage. It goes without saying that involving advisors early in the day will ensure better control over the communication being exchanged and prevent the creation of an unnecessary trail that can be counterproductive in a litigation.

Conclusion

The litigation process in India can be cumbersome, causing a great deal of hardship to parties involved. Therefore, to the extent possible, it is always preferable to settle matters outside of court. The set of facts already in existence or thereafter strategically fashioned through exchange of communication, could weaken or strengthen a client’s position. It will also determine a client’s position to negotiate a settlement. If the facts are in the client’s favor, then the counsel has a better bargaining position over the opponent. The development of facts also enables the counsel to decide the forum before which proceedings may be initiated to secure the best relief for the client. Given the overlapping nature of legislations in India, a client may have the option to initiate proceedings before multiple forums. However, some forums may have a distinct advantage over others, depending on the facts of the dispute. In our next article, we will try and explain how the forum for a litigation is usually chosen, based on facts.

Anshu Bhanot | Of Counsel, Veyrah Law; Priyanka Zaveri | Associate, Veyrah Law

Views expressed above are for information purposes only and should not be considered as a formal legal opinion or advice on any subject matter therein.

Veyrah Law
705 A Wing, Dalamal Towers, Free Press Journal Road,
Nariman Point, Mumbai 400 021
www.veyrahlaw.com