Negotiate, Don’t Litigate

By — on / Conflict Resolution

When you’re thinking about resolving a dispute in court, it’s crucial to remember that the decision that will be imposed on you is binding.

If blinders lead a judge to grant a motion that should be denied, deny a motion that should be granted, assign responsibility to the wrong party, or award too much or too little in damages, there can be no going back.

State or federal appellate courts exist in part to correct judicial errors, but appeals occur infrequently and seldom lead to reversal. Even successful appeals add costs and delays to the dispute-resolution process.

When you or your organization is embroiled in a dispute, how can you avoid the possibility of an erroneous but binding court decision? Negotiate instead!

Of course, you and your lawyers are likely to be influenced by the same blinders that affect judges – blinders that may compromise your negotiation ability.

But there’s a significant different between making a poor decision in a consensual process such as negotiation or mediation and being at the mercy of a judge’s mistakes.

Take a Seat at the Interests-Based Table

What type of negotiation best resolves thorny disputes?

In their influential book, Beyond Winning: Negotiating to Create Value in Deals and Disputes, Robert H. Mnookin, Scott R. Peppet, and Andrew S. Tulumello describe two theoretical tables at which legal disputes might be negotiated: the “net-expected-outcome table” and the “interest-based table.”

At the net-expected-outcome table:

  • Disputants and lawyers attempt to settle cases in the “shadow of the law” by calculating the expected value of the case at trial and settling for any offer that exceeds that amount.

Thus, if you’re the plaintiff, and your attorney predicts that you have a 50% chance of recovering $100,000 at trial at a cost of $20,000, your expected value at trial is $30,000 and you should be willing to settle for $30,001.

But because judges (and lawyers as well) can be influenced by the blinders described above, it’s actually quite difficult for a lawyer to predict expected values accurately.

Rather than focusing on obtaining a deal that exceeds an imperfect calculation of the expected value at trial, you may want to negotiate at the interest-based table.

  • Specifically, focus on the underlying interests, both financial and nonfinancial, that have motivated you and your counterpart to pursue the dispute.

By doing so, you are more likely to get what you want and less likely to settle for a dollar amount based on an expected value.

Most judges are honest people who strive to reach fair decisions. To say the misjudge is to say they are human – that their decision-making, like all of ours, is imperfect.

But because judicial decisions carry so much weight, the research on misjudging offers a sound reason to negotiate, rather than litigate, whenever possible.

Related Article: Keeping the Game Out of Court

In our FREE special report from the Program on Negotiation at Harvard Law School – The New Conflict Management: Effective Conflict Resolution Strategies to Avoid Litigation – renowned negotiation experts uncover unconventional approaches to conflict management that can turn adversaries into partners.

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