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ESCAPE FROM SELF-INFLICTED EDUCATION
Ten Points to Avoid Gambling With A Client’s Case
By: David C. Peterson, Peterson, JD, LLM, MDR*
 

INTRODUCTION:

As mediators we see the best and the worst of those engaged in negotiations during mediation. When writing about mediation we usually wish to please readers so titles emerge suggesting there is a means to “win” a negotiation.” See, for example:  How to Argue and Win Every Time (Gerry Spence), How to Win any Negotiation (Robert Mayer) and, my favorite title, Get Anyone to do Anything (David Lieberman). Unfortunately, this leads to unproductive thinking and action. It pays to view negotiation from a different perspective to avoid committing the most common of errors.

There are no real esoteric studies or packaged formulas for “winning” a negotiation. In fact, nearly every book and article discussing ways to “win” set forth what is described below. None propose that the other side loses so that victory may be declared over them. Rather, a client simply achieves an optimum result through the other side’s cooperation. And the client avoids the ever-present risk, expense and ordeal of trial. This is the “win” typically referred to by the authors who catch attention with such titles.

DISCUSSION:

When negotiating litigated matters it is the same as gambling. Fail to settle and face an uncertain result. No one knows for sure what cards will come up next. What will the judge or jury do? When do you “hold-em” and when to you “fold-em?” A mistake can result in disastrous consequences. Conscientious lawyers urgently wish to avoid mistakes when negotiating, especially in high stakes cases. But no one is immune from error, at least on occasion.

This is not because desire is lacking. Ample motivation is present driving an attorney to achieve what the client wants. Neither is it an issue of competence. The best litigators make wrong decisions or suffer impeding distractions from time-to-time. When errors occur it’s usually due to insufficient preparation, unproductive reactions and myopic views, leading to miscalculations in judgment and action during the negotiation.

The most glaring errors occur when failing to take into account the entirety of the circumstances faced by one’s client. Without effort to avoid this deficiency, the mind operates selectively. Choices, Values and Frames (Cambridge, 2005). This tendency is embedded in the ego - needing to get what one wants without interference or obstacles. Threats are ignored or pushed aside. This default function of the mind was described well by an anonymous author who observed: “Beware the man who knows the answer before the question.” Philosopher George Santayana put it this way: “All living souls welcome whatever they are ready to cope with; all else they ignore, or pronounce to be monstrous and wrong, or deny to be possible.

For example, my desire is to vacation in Cancun while my companion wishes to travel to New York. What do we do? In our minds we diminish all the good there is in the other’s proposed destination. We’re hardwired in this fashion. As Mark Twain observed: “The rule is perfect: in all matters of opinion our adversaries are insane.” It’s not our fault, at least until we recognize this and know how these tendencies hinder good decision-making.

Another trap leading to failure is ego. A lawyer’s over-inflated ego is not a client’s amigo. While ego is required for success, when inflated, especially if super-inflated, it will suffocate or push aside the wisdom, experience, practical thought, calm reflection, clear mindedness and other necessary brain functions needed to make optimum decisions for one’s client. In short, the natural mind and ego cause distortions in thinking. As summed up by comedian Emo Phillips (1956-): “I used to think that the brain was the most wonderful organ in my body. Then I realized who was telling me this.”

How many times in the midst of trial or at the end for that matter, has that sinking feeling arisen in a lawyer as they exclaim to themselves: “I didn’t see that coming,” or “I didn’t realize that would have such an impact?” Were they blind or deaf during discovery? Were their interpretations of the law that wrong? Actually, they likely refused to become fully cognizant of or grasp all there was to know about the case destined to affect its outcome. Certainly, anomalies occur during trial leading to unexpected outcomes but most times it’s simply that the attorney failed to see the oncoming train for the reasons articulated above. We wish that lessons need not be learned in this fashion but it’s inevitable that, “(s)ome people change when they see the light, others when they feel the heat.” (Caroline Schoeder) 

Those who are slow in this respect will likely acknowledge that their education in these matters was self-inflicted. This is what Michael Caro (world famous poker player and author) said after he became one the best poker players in the world. He attributed his belated success to repeated mistakes. It is not necessary, however, to be educated by a succession of miscalculations. Here are some suggestions to avoid the “school of hard knocks:”

TEN SUGGESTIONS FOR IMPROVEMENT:

1. When in Mediation or Negotiation, Listen Closely and Then Listen Some More:

We are afraid to listen. We don’t want to hear from the other side. They will try to tell us why their case is strong and ours is weak. It seems safer and easier to avoid knowing what they will present. If we don’t hear it or see it, it won’t exist. This is exactly the opposite approach to take. The more we understand about the other side the better we are able to grasp the entire picture and see clearly the landscape that must be negotiated. Top negotiators seek to know everything available about the other side including all they believe is supportive of their positions. Knowledge is power. Better decisions are made out of more complete knowledge. In addition we are able to correct misconceptions held by the other side when they are uncovered.

2. Accept  the Reality of What Is, Including Adverse Facts, Evidence, and Disagreeable Personalities:

The inability to see things as clearly as we should is a part of being human. Heuristics and Biases, The Psychology of Intuitive Judgment (Cambridge, 2002). No one is immune from interpretations of circumstances and events which are most favorable to them. It is a powerful, self-protecting mechanism that we are born with. We need to see reality in a way that best suits our needs and desires. We are afraid that if we acknowledge, for example, that the other side has a good point, it will demonstrate weakness on our part or legitimize the other’s case and enhance their confidence. Making Smart Decisions (Harvard Business School Press, 2006). This is not reality. Where it is obvious the other side has a good point along with evidence or law to support it, ignoring it or saying it isn’t so, causes a swift and damaging loss of credibility. Argue with reality and you will lose. Admit what is obvious. Do it out loud. And then explain why your client will nevertheless prevail or why it will not have the impact the other side believes it will. "Acceptance is not submission; it is acknowledgment of the facts of a situation, then deciding what you're going to do about it." (Kathleen Casey Theisen)  Also, do not be distracted by disagreeable personalities. Accept the other as they are. If odd or offensive, be amused not disarmed.

3. Maintain Focus, Not Being Sidetracked by the Immaterial:

Too many times we are distracted by inconsequential matters or events arising during interactions or exchanges. It may be a rude remark or a fact or issue raised by the other side which is immaterial but nevertheless results in a negative emotional reaction. Our focus can easily be lost when this occurs. Allowing yourself to be sidetracked and lose focus impacts your negotiating power and allows the other side to diminish your effectiveness. It’s the same as diverting water from a stream. The power of the flow is diminished. We know from war history that significant battles were lost when attention was diverted from the main battle by small skirmishes started intentionally by the opposition. There are varying ways in which we react under these conditions. The “fight or flight” instincts engage. These are fatal to one’s effectiveness in negotiation. Maintaining poise and remaining above the fray is always the best defense. It is disarming to the other side. Slip down to their level and you will fail.

4. Be Organized and Prepared:

One of the worst offenses committed during mediation or negotiation is the lack of preparedness or lack of organization. If you do not have all of your ammunition immediately available, your effectiveness is compromised. Facts, evidence, supporting law and crisp statements outlining your client’s position and support for it, need to be retrievable at a moment’s notice. It needs to be organized for easy presentation and understanding. Failing to recognize the importance of this and following through before the mediation or negotiation session, severely handicaps a client’s bargaining power.

5. If Things are Going South, Don’t Pretend They Aren’t:

We must all learn to play the ball where it lies." (Bobby Jones). One of the worst mistakes witnessed by mediators is when things have unmistakably gone very wrong in a client’s case and the attorney acts and negotiates as if it hasn’t happened. This only angers the opposing side. Usually, an opponent is much more amenable to a settlement better than the client will obtain at trial when terms are offered which reflect the reality of the circumstances. Pretending that what is so obvious is not true or has not occurred, robs the client of the ability to gracefully get out of the problematic situation. Pushing back at the other side under these circumstances can cause them to want to punish your client out of anger or frustration. Negotiate within the range dictated by the circumstances.

6. If Your Position is Growing Stronger, Don’t Overplay it:

Another mistake made is when one’s position appears to be growing in strength. There is a tendency to overreach. Feeling emboldened, demands are made which are far outside the zone of reason. A stronger case does not always mean a sure thing. And a sure thing does not mean one will obtain more than what is reasonable to expect under the circumstances. Overreaching causes the other side to shrink away from the negotiation. Why not walk away if the other side is demanding more than they can reasonably expect at trial? Unless a trial victory is particularly necessary, settle. Attorneys get into trouble when they don’t settle under these circumstances and the client fails to achieve a better net result at trial.

7. Negotiate Within the Reasonable Zone:”

This is one of the most common mistakes made. It’s not always possible to narrow down a reasonable range. However, it is quite obvious most times what is outrageous to expect or demand. While it may be true that one sets the bar with their opening number it is also true that attempting to set a bar that is patently ridiculous can ruin one’s credibility. The parties will typically struggle for a long period before the negotiation ship is righted. Most times, especially with experienced lawyers, both sides know the parameters within which to negotiate. The question when dealing with experienced professionals is not where the credible range is but who will do best by obtaining a settlement nearest to their goal. It is imprudent to cause a time-consuming and wasteful floundering about in the negotiation by attempting to establish a range obviously beyond that which is credible. It puts at risk what otherwise would be a productive and successful negotiation.

8. Approach Negotiation With Optimism and Maintain Patience Along With Perseverance:

If you go into a mediation believing it will fail or if you lose hope as it progresses, odds of failure increase. Even if it seems a settlement is unreachable don’t give up too soon. Be the first to leave and you will never know whether the matter would have settled. Unless you feel it best to depart first for tactical reasons, it’s never a good idea to get up and go when the other side is willing to stay. You cannot know what is going through the minds of those opposing you. If they are not leaving it means they are still willing to play ball. Frustration often gets the best of us when things slow down, especially when they go to a crawl. When negotiations become tough, the best negotiators shine. They know if they endure that a breakthrough will occur and the matter will settle. It happens repeatedly when parties stick it out. Negotiators who settle more cases and mediators with the highest rates of settlement, are the ones who are willing to be patient and persevere.

9. Propose Practical Terms of Agreement When an Understanding Has Been Reached:

A common error in judgment occurs after an understanding is reached when an attorney proposes settlement language which is unnecessarily harsh or presented in a way that is offensive to the other side. In their zeal to impress their clients or to get an edge on their opponent, attorneys will propose terms that are unnecessarily harsh, offensive or which significantly alter an understanding in principle. This is usually done without considering the effect on the other side. Agreements in principle break down or the settlement process is hampered or unnecessarily delayed by such tactics or strategies. It’s better to resist the temptation to overreach with offensive or inappropriate terms even where one feels they have the upper hand. How do you know if a proposed term is inappropriate, offensive or overreaching?  Put yourself in the shoes of the other side and consider how you would react if such terms were presented to you under the same circumstances.

10. Finish Strong, not Delaying Preparation of a Comprehensive Agreement:

First, it is unwise to let a matter rest overnight or longer in order to draft a settlement agreement. Too many settlements are ruined by the failure to immediately work to complete a document which contains the material terms of agreement and necessary enforcement language. While our fortitude can be tested by the end of a lengthy and difficult negotiation, the fact that it was lengthy and difficult is one of the most compelling reasons to get it all down in writing before anyone leaves. Take a short break, get some air, walk around the block but don’t go home. Work until the work is finished. One of the most disheartening things to occur is to see many hours of talent and skill go completely to waste because the parties were unwilling to spend that extra time to make sure they completed an enforceable agreement.

CONCLUSION:

You will find that experienced mediators are able to assist attorneys and parties most effectively during the mediation process when the attorneys understand the concepts outlined above. These principles and practices have been written and taught extensively by the world’s most experienced negotiators, including successful trial lawyers (Gerry Spence for example). Three examples were given at the beginning of this Article. Other good sources include: You Can Negotiate Anything (Herb Cohen), Smart Negotiating (John Patrick Dolan), Fearless Negotiating (Michael C. Donaldson), Mastering Business Negotiation (R.J. Lewicki & A. Hiam), Getting to Yes (R. Fisher & W. Ury), and How to Negotiate Effectively (David Oliver). It is urged that those who mediate and negotiate read such guides in order to fortify their knowledge and effectiveness. END


Mr. Peterson is a full-time mediator in litigated cases and frequent MCLE provider, practicing since 1995 in the Central Coast area of California (San Luis Obispo to Los Angeles, and the Central Valley). He holds Masters and LLM Degrees in Dispute Resolution from Pepperdine University School of Law, Straus Institute for Dispute Resolution. For questions or comments, Mr. Peterson may be reached at (805) 441-5884 or davidcpeterson@charter.net. Web: “David C. Peterson Mediator.”


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