General Practice, Solo & Small Firm DivisionMagazine
Volume 17, Number 7
Approaching Negotiations Playing a Cooperative Game
By Juliet L. Gee
Negotiating is defined as any instance in which two or more people are communicating with each other for the purpose of influencing the other party’s decision, according to Fisher and Ury in Getting to Yes. It is essentially a problem of exchange as the parties bargain with each other. A skilled negotiator guides the parties, with their mixed motives of cooperation and competition, toward an agreement.
Two types of negotiations are available to parties: voluntary negotiations and mandatory settlement conferences. For voluntary negotiations, you will need to open up your opposition, prepare for negotiation, and keep going when negotiations stall. And you’ll want to be able to use mandatory settlement conferences to your advantage as well. You also may face postjudgment negotiations.
Should you negotiate when the opposition appears to be saying no to negotiations? How do you get the other side to at least listen to you? How do you open them up? In commencing negotiations, there is always tension between cooperation and competition. The key to starting any negotiation is to open up the other side by empowering them to hear your demands. In part, you are empowering them to feel comfortable in rejecting your demands. If the parties start the discussion process in a tense and competitive atmosphere, it will elicit the primal instincts to fight and not cooperate.
When your opposition tells you or implies that they are not willing to negotiate, develop a strategy to change the game from an adversarial one to a cooperative attempt to solve mutual problems. Find a way to move the opposition from a defensive stance. Be conditionally open to the other side. Don’t hold grudges. Sometimes our own choice of words and the intensity of our voices will close off negotiations. Start dealing with your opposition on a positive note. If you start out by attacking, the other side will resort to self-preservation. If you start out with a cooperative attitude, you are less likely to be met with the counter force of defense.
Getting the opposition to be open to hearing you is the first and most important step in negotiating a settlement. Even if you are met with hostility, do not fall into an adversarial attitude. It is harder to negotiate when both lawyers are hostile toward each other. Simplify and prioritize your client’s issues. Develop a starting position and various fallback positions for each issue. Most important, listen to the other side.
In every negotiation, it is possible for both parties to help each other at no expense to themselves if each understands the problems of the other and tries to solve problems together. Rarely is there total disagreement on every aspect of a case. There are often at least procedural issues about which the two sides can reach an agreement. It is useful to break the negotiation into stages. Start negotiating on simple procedural matters. If you start on matters that are not at the heart of the dispute, you are more likely to have initial cooperation. It is easier to get larger concessions from a party if you get them used to giving a series of smaller concessions first. Choose issues that hold no emotional value to either party to initiate the negotiations. In this process the parties can move away from a competitive attitude toward a cooperative attitude.
The power you have to negotiate comes from knowledge of the case. The more knowledge you have of the facts and the law of your case, the more power you have to negotiate. You should also consider what would be the best alternative to a negotiated agreement, which could be a jury verdict or an arbitration award.
Lawyers should prepare for negotiations in the same way they prepare for trial. Know your case. Be aware of its strengths and weaknesses. Understand the conflict situation. Learn from your client the facts that created the conflict. Conduct an independent investigation of the facts, because your client’s perception of the facts may not always be accurate. Consider what facts you are willing to disclose to the other party and what facts you will not reveal. In business law matters, for example, some facts may constitute trade secrets. In analyzing the facts, you may also find that you need additional facts. You may need to conduct further investigation, either through formal or informal discovery.
Amass case law support. What statutes and case law do you have on your side? Is this a case of first impression? If it is a precedent-setting case, your client or the opposing party may not be interested in reaching a settlement; conversely, the parties may not want to have a legal precedent in the public record. Learn as much as possible about the parties, the lawyers, the insurers, and any other involved persons. In multiparty cases, assess where the parties have similar claims and needs and where there are differences.
Understand how the other side sees the conflict. Put yourself in their shoes. Are highly charged emotions involved? For example, is this an ongoing dispute between neighbors or spouses? Or is the dispute between an insurance carrier and the claimant? Is the insurance company negotiator afraid of "opening the floodgates" if the case settles? Consider whether you need expert help. In complex, specialized cases the parties may consider using a mediator who is an expert in the subject matter. For example, in a construction case the parties may use a mediator who is a licensed building inspector.
Separate the people from the problem. Recognize the emotional aspects of the case and try to maintain an objective stance. A highly charged emotional case may require a neutral outside mediator. Avoid getting into a battle of wills with the other party. There is a difference between reason and pressure. Negotiations in a series of repeated dealings with the other party can be used to induce interest in trust and cooperation. A strong dose of cooperative attitudes early on in the process may spill over to later phases of the negotiations so that the parties will be more willing to tackle the hard issues jointly. Make cooperation more salient than competition. Use phrases such as "Can we find a solution?" or "Can we agree?"
Find out what your client wants. What are the needs that are fueling their position? What are your client’s priorities? Ask what kind of decision by the other side would satisfy these interests.
Analyze the other side. Discover what the other side fears and try to alleviate that fear. Gain knowledge about the opposing party. Learn about their personal concerns, background, values, and so forth. Find out what the other side wants to achieve. Determine their interests and priorities. What kind of decision would they like your client to make? What is their bottom line? Sometimes, to figure out the bottom line for an institution or organization, you need to find out how it is organized. Who is the client, the board of directors? Is there a risk manager who has set the limits on the litigation? What are the costs, monetary and nonmonetary, to the other side to litigate the case? Assess the risks and gains to both parties.
Consider cultural or social differences. In some cultures, litigation is to be avoided at all costs because it is seen as a loss of honor to the parties. Try not to make assumptions. Ask questions. In some cultures, negotiations must be approached circuitously rather than directly. Words need to be chosen carefully so that neither side appears to be losing face. A misunderstanding of cultural differences can quickly end the negotiations process. In those instances, an apology will sometimes get the negotiations back on track.
Don’t deceive. Tell the truth and be who you are. There are several hazards to lying or deceiving the other party in the negotiations process. When deceptions or lies are discovered by the other party, trust between the parties is lost. In addition, the obligation to behave truthfully in negotiations is embodied in the requirements of Rule 4.2(a) of the Model Rules of Professional Conduct, which direct the lawyer to be fair in dealing with other parties. A settlement agreement based on lies told by one party can be set aside as an agreement induced by fraud. Moreover, your reputation in the legal community can be seriously damaged if you engage in deceit in the negotiating process. Negotiations in the future with other parties may be met with distrust.
Avoid positional bargaining. In this type of negotiation, each side takes a position and argues for it. It is an inefficient technique in which parties find themselves locked into positions. Also, avoid share bargaining, which presumes a limited pie to be shared, so that if one side takes a piece of the pie, the other side has less. Positional bargaining and share bargaining limit the parties to zero-sum gains. Using an issue-oriented or principled bargaining process, the parties negotiate issues on the merits. They can look for creative solutions, and they will be more likely to reach a joint settlement. Look for options that have mutual gains. Again, break the process into steps. Finding small mutual gains and solutions can lead to larger gains in the long run.
Not all cases can be settled. In some instances the party’s concerns with precedent, reputation, prestige, and similar interests may be an overwhelming hindrance to negotiated settlement. Some cases involve issues of legal precedence that may be the goal of a party. For example, an insurance carrier may see a case as one for legal precedence on a coverage issue, or a case may involve precedence-setting civil rights issues. In these cases, however, you can still negotiate procedural matters. For example, the parties could benefit from negotiating the briefing schedule or a discovery schedule. The parties may also be amenable to negotiating the amount of damages to be paid after a ruling by either a trial court or appellate court on the issue of law.
Most courts have various settlement programs, one of which is usually a voluntary settlement program that is party-initiated. Some courts assign volunteer lawyers to attempt to mediate or settle the dispute. These can be single lawyers or panels of lawyers that act in a settlement capacity. In other instances, the parties may choose a private mediation or arbitration program.
The limitation of voluntary programs is that they usually require both parties to agree to enter into such a program. Even with such limitations, they are helpful in providing the parties with a neutral third party to mediate the dispute. A third party’s perspective of the case is especially helpful in emotionally charged cases. Sometimes all the parties need is a neutral, communicative climate to help them settle a matter. If you are before a neutral third party, don’t be afraid to ask the neutral what solutions he or she can see for the problem. That person can suggest solutions that have not been explored previously.
The other type of program is the court-initiated mandatory settlement conference, in which the court requires the parties to participate prior to trial. These conferences may take various forms: single judge conference, bench/bar panels, lawyer volunteers. The goals of a settlement conference, as far as the court is concerned, are twofold: to obtain a fair resolution of the dispute and to eliminate the case from the rolls. Before the parties meet with the mandatory settlement judge or panel, the judge needs to be educated about the facts and theories of the case.
Many courts require settlement statements from the parties. These statements are designed to educate the court as to the nature of the case, the facts, and the issues in dispute. You may also consider using the statement to put forth ideas for solutions in the dispute. Each state and each court differs with respect to requirements for settlement conference statements. Check with your local court rules to determine whether such statements are required and if so, what is required in their content. If there is no requirement for settlement conference statements, you may consider asking the settlement judge if the parties may provide such a statement. They are useful in streamlining the negotiations process and in notifying parties of the outstanding issues in the case.
Sometimes the hardest part of negotiations is putting yourself in the opening position to discuss resolution to the case. It is especially difficult if you are met with negativity or hostility. However, if you deflect the negative or hostile attitude with a neutral or positive attitude, you will find a possible route to opening the parties up to negotiations.
Juliet L. Gee is a solo practitioner in El Cerrito, California. She was a mediation attorney with the U.S. Court of Appeals for the Ninth Circuit and serves as a settlement attorney for the Alameda County Superior Courts in California.