Sefer Baal Shem Tov Bereishit # 52:
The purpose of man’s creation in this world is for one to busy oneself with Torah study and doing mitzvot as it says in the tiqqunim (Tiqqunei Zohar tiqun 40). “‘And he divided the waters from the waters.’ The secret here is to be occupy oneself with oral Torah and to distinguish between the permitted and forbidden, the pure and impure, etc.” From the Shechina, also known as halacha, comes forbidden, impure etc. However, everything emanates from the six extensions of the lesser countenance, which has a right and a left, which is kindness on the right and strength on the left. How much more so does it emanate from the three upper sefirot (hochma, binah and daas), which are singular. Therefore, our teacher explained the Gemara (Eruvin 13b, Hagigah 3b); even though these are permitted and these are forbidden, this refers to the level of the six extensions of the lesser countenance. However, above the level of Binah, which is called “living G-d,” all is one. This is what it means when we say “These and these are the words of the living G-d (Elu V’Elu Divrei Elokim Hayyim).” [Ben Porat Yosef 69c]
Apparently, the Baal Shem Tov reads the concept of mahloqet, argument, as being a natural consequence of creation. As multiples come into existence, it becomes impossible to have any singularity other than G-d. I find his claim much more compelling than to argue for a historical approach, namely, as things become forgotten, arguments occur. In a global sense, any and all argument must be “true” for multiplicity of existence would also require an infinite amount of possibility of description and response.
For an article on the notion of mahloqet in early hasidism, see Shaul Magid ” The intolerance of tolerance : “mahaloket” (controversy) and redemption in early Hasidism” Jewish Studies Quarterly 8,4 (2001) 326-368.
On Elu V’Elu in general, see the recently translated work, The Open Canon: On the Meaning of Halakhic Discourse, by Avi Sagi.