Business and Commercial Dispute Negotiation Role-Play:

Cape Development Case

Two-party real estate negotiation between a developer and a representative of the owner of a parcel surrounded by the developer's land, over the future of both parcels

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SCENARIO:

Approximately three years ago, Cape Development Corporation sold one of its thirteen adjoining lots to Charlie Davis. Although Davis had plans for the lot, it is still undeveloped. The City Council has now passed a cluster zoning ordinance which permits townhouse development if some land is permanently dedicated as open space. The 12 remaining lots, which are still owned by CDC, together with Davis’ lot, make a prime location for a cluster development. Such a financial asset is appealing to both parties, and has led them to this meeting to pursue a development. Both Davis and CDC have empowered agents to represent them, giving them authority up to maximum offers.

 

MECHANICS:

This one-on-one negotiation can run from 30-60 minutes. Teams of two can also be used, with somewhat longer times for preparation and negotiation.

 

TEACHING MATERIALS:

Role Specific:

Confidential Instructions for:

  • Cape Development Corp. Representative
  • Charlie Davis’ Representative

 

Teacher’s Package:

  • All of the Above

 

PROCESS THEMES:

Attorney/Client relations; Authority; Competition v. Cooperation; Cost-benefit analysis; Financial analysis; Information exchange; Joint gains; Lawyering; Objective criteria; Offers, first; Options, generating; Pareto optimization; Quantitative analysis; Relationship; Reservation price; Risk aversion

 

MAJOR LESSONS:

There is tremendous opportunity for exploring creative options in this negotiation. Poorly handled, however, an adversarial deadlock can result. What techniques minimize the likelihood of that outcome?

The distributive bargaining component of the negotiation permits participants to perform cost-benefit analysis, as well as reflect on the importance of focusing on joint gains.

It is useful to explore how the participants use their reservation prices to determine opening positions and concession strategies. Is this justified? Effective?

Participants can see what role analysis of projected costs plays in achieving a Pareto-optimal outcome, and what effect it has on the decision-making process.

 

Cape Development Case Attributes

Time required:
30 minutes-1 hour
Number of participants:
2
Teams involved:
No
Agent present:
Lawyer
Neutral third party present:
None
Scoreable:
No
Teaching notes available:
No
PON Teaching Negotiation Resource Center

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Soft copy vs. hard copy

You may order this role simulation in either soft copy (electronic) or hard copy (paper) format. If you select the soft copy option, you will receive an e-mail with a URL (website address) from which you may download an electronic file in Adobe Acrobat PDF format. You are then permitted to view the document on your computer and either print the number of copies you purchased, or forward the electronic file as many times as the number of copies you purchased. You will only receive a link to one electronic file per document. So, if you order 25 soft copies, you may either forward copies of the link to 25 people via e-mail, or print (and/or photocopy) 25 hard copies of the document.

If you select the hard copy option, you will receive paper copies of this role simulation via the shipping method you select.

The purchase price and handling fee are the same for both soft and hard copies. Soft copies do not entail a shipping fee.

For additional information about the soft copy option, please visit our FAQ section, or contact the PON Teaching Negotiation Resource Center at tnrc@law.harvard.edu or 800-258-4406 (within the U.S.) or 781-966-2751 (outside the U.S.).

Please note: At the present time, Teaching Negotiation Resource Center soft copies are compatible with the following versions of the Adobe Acrobat Reader: English, German, French, Spanish, Swedish, Portuguese, Japanese, and Korean. If you have a different version of the Acrobat Reader, you may wish to download one of these at http://www.adobe.com/products/acrobat/readstep2.html, or contact the PON Teaching Negotiation Resource Center at tnrc@law.harvard.edu, 800-258-4406 (within the U.S.), or 781-966-2751 (outside the U.S.) for further assistance. This restriction does not apply to the freely available Teacher’s Package Review Copies.

Ordering a single copy for review

If you wish to review the materials for a particular role simulation to decide whether you’d like to use it, then you should order a single Teacher’s Package for that role simulation. A PDF, or soft copy, version of the Teacher’s Package is also available as a free download from the description page of most role simulations and case studies. There is no need to order participant materials as well as a Teacher’s Package, as all Teacher’s Packages include copies of all participant materials. In addition, some Teacher’s Packages (but not all) include additional teaching materials such as teaching notes or overhead masters. Please note that the materials in Teacher’s Packages are for the instructor’s review and reference only, and may not be duplicated for use with participants.

Ordering copies for multiple participants

If you wish to order multiple copies of a role simulation for use in a course or workshop, simply enter the total number of participants in the box next to “Participant Copies.” There is no need to calculate how many of each role is required; the Teaching Negotiation Resource Center will calculate the appropriate numbers of each role to provide, based on the total number of participants. For example, if you wish to order a 2-party role simulation for use with a class of 30 students, you would enter “30” in the box next to “Participant Copies.” You then would receive 15 copies of one role and 15 copies of the other role, for use with your 30 participants. As another example, if you ordered 30 participant copies of a 6-party role simulation, you would receive 5 copies of each role.

In the event that the number of participant copies you order is not evenly divisible by the number of roles in the simulation, you will receive extra copies of one or more roles. Participants receiving the extra roles may partner with other participants playing the same role, thus negotiating as a team. So, for instance, if you ordered 31 copies of a 2-party role simulation, you would receive 15 copies of the first role and 16 copies of the second role. One of the participants playing the second role would partner with another participant playing that same role, and the two would negotiate as a team.