BLOG: Andrew Whalley on a surge in litigation cases

But what is worrying is that some businesses have no structures in place to deal with disputes and litigation effectively, which in the long term could have a serious and detrimental effect, both financially and to the reputations of the individuals and businesses involved.

A recent case saw a motorist awarded £20,000 in damages against Newham Council after disputing £150 worth of parking ticket fines, claiming that the repeated requests for payment left him emotionally distressed.

When the motorist pursued damages the council failed to acknowledge the proceedings or appear at the listed court hearings, which meant that he won by default. He was awarded £5,000 for each of the four tickets (which he hadn't even paid!).

The council failed to respond to the default judgment served on them - it was only when the bailiffs arrived at its offices and started removing computers that the council realised what had happened.  To stop its equipment being taken away, it paid the bailiffs £20,000.

Although the council later had the default judgment set aside, the motorist had spent the £20,000 and was in no position to give it back.

The council learned a hard and expensive lesson in this case.

Although an extreme example, it highlights the importance of having correct structures in place to ensure that any court proceedings go to the right person and are dealt with expeditiously.

Such issues are high on the agenda of in-house lawyers and businesses. This has been confirmed by the feedback received as part of DLA Piper's Litigation and Regulatory What In-house counsel Need (WIN) initiative.

The story above shows that any given case can escalate if the right checks and balances aren't in place to deal with a dispute, whether you are in the right or wrong.