The Power of Principle, Part 1

Kimberly Sands, a partner with Upchurch Watson White & Max, has been a civil litigator and has been involved with difficult and complex disputes as litigator or mediator for over 30 years. To schedule a mediation with Kimberly, please call her case manager, Cathy McCleary, at (800) 863-1462, or visit our online calendar.

UWWM Principal Kimberly Sands UWWM Principal Kimberly Sands

I recently had the pleasure of moderating UWWM’s webinar, “The Seven Deadly Sins in Business Negotiation” featuring UWWM’s neutral Judi Lane. I was very happy to do so. I had previously mediated for Judi many times and had great respect for her as an attorney and as a negotiator. She also always demanded the most of me as a mediator. When she joined UWWM, she and I continued our exchange of thoughts and experiences with respect to mediation strategy and negotiation. I continue to learn a lot from her and, I hope, she from me.

A common subject that always surprises me, although perhaps shouldn’t after so many years, is the extent to which a human element drives many business negotiations. One expects it when the issues are personal, but business is business, right? So, isn’t it just a question of making a good business decision? Wouldn’t it be nice for all of us who represent or otherwise serve such clients if we could say that’s true? In fact, this element is sometimes more intractable in business claims than it is in more personal disputes.

It is sometimes expressed as “principle” or what is “fair” or “just.” Just as often, it’s expressed in anger, usually directed at the opposing party for its transgressions. However it’s expressed, it can’t be overlooked, no matter how unprofitable it may appear to an outsider. As Judi advocates in her webinar, you need to dig in, find out what is behind it, and search for options that address whatever is driving this decision-making.

The scenario in today's blog -- and one in a follow-up blog -- may be illustrative. The first is a recipe for disaster. In a breach of contract claim, Plaintiff’s counsel assumes the client’s claim is so simple and meritorious that early mediation is suggested. Admirably, Plaintiff’s counsel communicates with Defense counsel who concurs. Unfortunately, they are not on the same page with respect to this dispute. Defense counsel is new to the case and has minimal contact with the client prior to mediation. Compounding the problem, both Defense and Plaintiff’s counsel agreed to go forward with the Defendant’s decision-maker appearing by phone.

Disputes tend to find the weakness in contracts -- if not legally, certainly in the parties’ perceptions of what is required by the contract. This may cause the drafter of the contract to be overly protective of its infallibility and the opposing party to be righteously indignant and combative with respect to how the contract should be interpreted. Both parties may be more focused on the document than on finding ways to go forward in their business.

Safe to say, in this scenario, the Defendant is unprepared for this process; Defense counsel, with little or no knowledge of the client, has little or no influence, and I, as mediator, have an uphill battle, especially with a disembodied voice over the phone, in having a meaningful discussion with the Defendant decision-maker about the risks and disadvantages of litigation or evaluating the available opportunities for resolution. As a consequence, whatever I might have been able to do with respect to the expectations of the Plaintiff, who may present as similarly intractable, is a moot point. It's not a wasted effort, since everyone’s eyes are now opened as to the dynamics of the parties and the dispute, but decision-making is limited to the first two stages of personal grief: denial and anger. If I could get to the third, bargaining, I would have a good chance of achieving what both lawyers expected, a more equitable and economical solution to their client’s dispute.

What went wrong? Not in any particular order:
  1. Defense counsel didn’t prepare the client for mediation and did not know the client well enough to know its business, its “feelings” with respect to the dispute, or to have the relationship necessary to be an effective advocate and adviser;
  2. Plaintiff’s counsel over-estimated the Defense preparedness for mediation;
  3. Both went forward without assuring that the Defendant decision-maker could adequately attend by phone; and finally
  4. I have to make a subjective decision about how much time I should devote to trying to overcome the lack of preparedness and “principles”-driven decision-making, assuming the parties even give me a chance to do so.
What else could go wrong? Please see Part 2, coming soon.


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