Our local court systems have been unprecedently affected by COVID-19 just like other resident businesses. New Jersey Supreme Court Chief Justice Stuart Justice Rabner entered an order on March 27, 2020 that provides procedural and logistical guidance on the suspension of certain court proceedings in the New Jersey State courts. As of March 22, 2020, New York State courts temporarily suspended filings (both paper and electronic) in non-essential matters which includes the majority of business-related disputes. While the guidance provided is instructive for lawyers, from the perspective of businesses and their owners, the recent suspensions and closures of certain courts in New Jersey and New York pose yet another hurdle to timely resolution of all types of disputes. The court situation is so murky that clients and advisors have reached out simply to confirm if courts are open for business. While frustrating, the restrictions on court access, proceedings and trials may actually present an opportunity for businesses to consider alternative methods to dispute resolution.
In fact, with guidance from counsel, business-to-business resolution of disputes should be the first consideration as business practicalities should dictate approach more than ever. Generally, experienced counsel can use the less formal platform to frame the core issues while ideally minimizing fees and without the restrictions of procedural rules and deadlines. Of course, regardless of forum or approach, evidence of claims should still be properly documented.
If B-to-B efforts are not initially successful, you should consider the possibility of ADR (e.g., mediation or arbitration). While the court systems will have limited schedules and will undoubtedly experience growing pains while transitioning to virtual proceedings, ADR providers have more familiarity with remote facilitation and matters are not publicly available. That said, there are other considerations with ADR such as cost.
The impacts of the COVID-19 will continue to reverberate through the economy and our businesses – whether it be in slow receivable payments, contract breaches, management disputes, or employment unrest. If you would like guidance on how to approach commercial disputes in light of COVID-19 or to review forum/dispute resolution clauses in governing contracts, please contact either Christian Jensen () or Rich Angowski ().