PREPARING ORGANISATIONS FOR IMMINENT DISPUTE RISKS
Organisations tend to think about disputes in two modes: the hypothetical and the actual. In the hypothetical mode, risk is acknowledged in general, theoretical terms, typically through board-level discussions, compliance frameworks, policies and insurance programmes.
In the actual mode, a dispute has arrived crystallised and must be managed. What sits between these two modes, the period during which a dispute shifts from possible to actual, is often the least well-managed part of the process, and yet it is frequently where outcomes are determined.
This article considers how organisations can better prepare for imminent dispute risks that are not yet, but may soon be, upon them.
Recognising the signals
The first challenge is recognition. Disputes rarely arrive without warning, but the warning signs are not always obvious. They may take the form of a counterparty becoming unresponsive, a pattern of late or partial performance, internal audit findings suggesting process failures, a regulatory inquiry that is broader than initially understood or even a vague statement by a counterparty during a casual conversation.
In practice, these signals are often recognised at the operational level but are not escalated in a way that triggers structured legal or strategic preparation. The failure to raise the potential concerns may originate from a fear of crying wolf or simply being too overloaded with daily operations to flag concerns.
A procurement team may be aware that a supplier is struggling. A compliance function may have identified irregularities that could attract external scrutiny. A commercial team may sense that a joint venture partner’s priorities have shifted. Each observation, taken in isolation, may not warrant formal legal engagement. Taken together, they may point to an imminent dispute.
Jul-Sep 2026 issue
Morrison & Foerster (UK) LLP