Win-Win Solutions: Effective Out-of-Court Dispute Resolutions


Writing an article with such a title by a lawyer who has dedicated his entire career to litigation and enforcement of court decisions is, you'll agree, at the very least unexpected. The practice of recent years pushed me to write it.

I will share these cases with you, and each of you will draw your own conclusions.

Kuwaiti IT Company: Inadequate Quality of Services and Breach of Deadlines

Essence of the Dispute

A Kuwaiti company ordered the development of a mobile app and a gym management website from a Ukrainian company. Before signing the contract, the Ukrainian developers assured that they had the necessary capabilities to fully perform the contract within the stipulated time frame.

However, a year after the start of work, the Ukrainian side reported that they could not connect their code to the client's database. They also failed to complete the website. By this time, they were already six months overdue. Despite the client's request for a refund, the developers refused to comply under various pretexts.

Judicial Perspective

Both parties had their documents in order. Two contracts were signed for both orders, containing all essential terms for such agreements. However, there were some drawbacks. The client's payment was made not from the company's account but from the Director's account. Additionally, part of the payment was made not to the developer's account but to another person's account. This posed significant risks in proving the fact of payment for services in a Ukrainian commercial court.

Out-of-Court Resolution

The Kuwaiti client had a clear vision of a fair resolution of this dispute. He acknowledged that the opponent had completed some work, which he estimated at 75 percent. However, he was outraged by the Ukrainian counterpart's disregard for his demands and the missed deadlines.

Lawyer Dmytro Chuhuiyenko prepared proposals for an out-of-court settlement, which described the entire situation, the legal grounds for going to court, and the client's position on fair compensation and dispute resolution. The proposal was not formatted as a claim-demand, as lawyers usually do before filing a lawsuit, but as a proposal, creating a friendly basis for negotiations.

The response from the Ukrainian company came quickly. The company's director contacted the lawyer. Together with the lawyer and the director, we discussed possible ways to resolve the dispute, what the Ukrainian side agreed with, and what it partially agreed with. He gave his wishes and comments on the out-of-court resolution. Then the director of the Ukrainian company contacted the director of the Kuwaiti company. They agreed that the compensation amount would be slightly lower, but the Ukrainian side would provide all materials and support to the new developers to speed up the product development process. Although the website cost was fully compensated, the developer provided the client with the source code and all materials of the website for free, as a sign of respect and gratitude for the cooperation.

Dispute Resolution

The client received fair compensation and all necessary materials, and the developer maintained their reputation. One less case in court.

Ukraine: Unlawful Retention of Someone Else's Construction Property (Scaffolding)

Essence of the Dispute

For the construction of a residential building, the landowner hired a foreman. The foreman signed a contract with a contractor to rent scaffolding worth 150,000 UAH. Acting in bad faith, the foreman did not complete the task set by the owner and disappeared in an unknown direction.

The contractor approached the owner asking to return the scaffolding, as the foreman had overdue rental payments and was unreachable. The owner refused to return the scaffolding, arguing that the foreman had not completed the work he was paid for, and until he did, there were no grounds for returning the contractor's property.

Judicial Perspective

An absolutely clear judicial perspective. A lawsuit to reclaim property from illegal possession. All documents, including the contract and calculations, were in order. However, the court process could take months or years.

Out-of-Court Resolution

Lawyer Dmytro Chuhuiyenko prepared a demand, gathered information about the construction site owner, and sent it in electronic and paper form.

Dispute Resolution

Upon receiving a justified demand from a reputable law firm, the construction site owner contacted the client and expressed readiness to return the scaffolding. The client was not liable for the foreman's debts to the owner and got their property back.

South Korea: Dispute Between Former Partners

Essence of the Dispute

Former partners had business relations, resulting in one partner possessing tokens and digital assets belonging to the other, stored in a digital safe.

The client's interest was in reclaiming his electronic assets:

  • 90% of purchased tokens;
  • 100% of all digital assets stored in the digital safe.

Judicial Perspective

To prompt the partner towards an out-of-court resolution, it was important to highlight the judicial perspective and defense strategies. One option was to recover unjustly acquired funds, including cryptocurrency, from both the individual and company accounts. The lawyer had evidence of payments totaling $559,000 over a year without any legal grounds:

  • $337,000 in cryptocurrency;
  • $108,000 to a personal account;
  • $41,000 to a company account;
  • $73,000 over several months.

If the partner refused to engage in out-of-court negotiations or ignored the proposal, the client would have to sue for $41,000 paid to the company account and $518,000 paid to the personal account, including legal fees, court costs, and damages.

Out-of-Court Resolution

The lawyer sent a demand with the following content:

Your position on resolving the dispute is requested in response to this proposal.

Considering the impossibility of independently resolving the dispute between you and the client, I propose negotiations aimed at restoring communication, identifying the true interests of both parties, and satisfying these interests in the most acceptable way for all participants.

If an agreement is not reached, this dispute will be resolved by the court under Ukrainian law. You are not required to admit any facts, refute them, or provide any evidence during the out-of-court settlement process.

The principles of this out-of-court settlement are:

  • Voluntariness;
  • Confidentiality;
  • Sincerity in resolving the conflict;
  • Neutrality of the mediator.

Dispute Resolution

After several months of negotiations, a mutually beneficial agreement was reached.

Israel: Non-Delivery of Equipment and Refusal to Refund

Essence of the Dispute

In April, a contract was signed between a seller and a buyer from Israel for the supply of goods. The seller committed to deliver the goods within 8 weeks after receiving a 50% advance payment, amounting to €150,000.

The buyer fulfilled the contract terms by transferring €42,000. However, the seller did not meet the delivery obligations, resulting in penalty obligations for each day of delay as stipulated in the contract. By November, the total penalty amounted to €106,000, and the seller's total debt was €148,000.

Judicial Perspective

If the debt was not paid within 7 days of receiving the demand, the buyer intended to file a claim with the International Commercial Arbitration Court at the Ukrainian Chamber of Commerce and Industry to recover €144,000 plus court costs and legal fees. The case would cost at least €10,000 to process, with a lengthy wait for a decision. While a favorable ruling was likely, the chance of recovering the funds was minimal, as the debtor company was preparing for bankruptcy.

Out-of-Court Resolution

A demand was sent to the debtor, initiating negotiations and removing the client's emotional aspect. After several months of negotiations, the debtor agreed to repay the debt in installments. The agreement specified that if no payments were delayed by more than three business days, the penalties were limited to €10,000. If any payment was missed or incomplete, the agreement would automatically terminate on the fourth business day after the due date.

Dispute Resolution

The debtor voluntarily repaid the debt according to the agreed schedule.

Nigeria: IT Specialist Unpaid

Essence of the Dispute

An IT specialist from Nigeria did not receive a $930 salary from a Ukrainian company due to payment difficulties and the full-scale invasion. The company ceased communication.

Judicial Perspective

There was no written contract, making legal action impossible.

Out-of-Court Resolution

A demand was sent to the employer's associate on UpWork with the following content:

Greetings. My name is Dmytro Chuhuiyenko, I am a lawyer and managing partner of the law firm "Disputes".

The firm provides professional legal assistance to a citizen of the Federal Republic of Nigeria regarding the recovery of the client's salary amounting to $930.

The client informed me that you are an associate of his employer on UpWork. He also reported that his due salary is not being paid due to payment difficulties from Ukraine and other circumstances.

We have repeatedly helped foreign clients transfer funds outside Ukraine and have sufficient international payment instruments for this.

I propose that you participate in out-of-court negotiations and find an optimal solution.

I look forward to prompt contact and resolution of the dispute.

Dispute Resolution

After receiving this email, the employer paid the full due salary to the client within a day.

Ukrainian Citizen: Inability to Return from Tajikistan Due to Lost Passport and Embassy Obstacles

Essence of the Dispute

The client claimed to have repeatedly contacted the Ukrainian Embassy in Tajikistan and Afghanistan for assistance in returning to Ukraine after losing his passport but was denied help for various reasons. His last visit to the embassy was in December 2021, where he was told his documents were being checked, but no official confirmation was provided. The client remains in a state of legal uncertainty, unable to return to Ukraine.

Judicial Perspective

There was no legal case without an official refusal or written explanation from the embassy. The only option was to challenge the embassy's actions to the Ministry of Foreign Affairs.

Out-of-Court Resolution

An attorney sent a request to the embassy with the following content:

I am contacting you to request assistance for a Ukrainian citizen in returning to Ukraine, outlining the necessary steps for such a return.


  1. Assist the Ukrainian citizen in returning to Ukraine.
  2. Explain the obstacles to the citizen's return and the actions he needs to take.
  3. Schedule an official meeting between the Ukrainian citizen and competent officials of the consular division of the embassy to arrange a temporary return certificate to Ukraine.

Dispute Resolution

A few days after receiving the request, the embassy called the client and issued a return certificate.

Advantages of Out-of-Court Dispute Resolution

Obvious Disadvantages of Court Dispute Resolution

I deliberately did not mention the standard drawbacks of court dispute resolution, as they are obvious even to those far from the justice system:

  • Significant deterioration of relations and inevitable conflict escalation;
  • Lengthy court proceedings;
  • Difficulty in enforcing court decisions;
  • Uncertainty of victory for both parties;
  • Legal expenses;
  • Reputation risks and publicity.

What Is Needed to Encourage Out-of-Court Dispute Resolution?

  1. Calmness: Remove the emotional aspect;
  2. Respect: Mutual respect between parties;
  3. Interest-based approach: Focus on interests, not desires;
  4. Mediator: Engage a neutral mediator to moderate negotiations.

In Conclusion

Ukrainians, both individuals and companies, increasingly choose out-of-court dispute resolution, moving closer to European and American standards and demonstrating a high level of civility.