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<\/p>\nIt sometime sometimes seems that the community of business lawyers is divided into two broad tribes:\u00a0 The lawyers who handle the deals, and the lawyers who handle what happens when the deals fall apart.\u00a0 Unfortunately, these two tribes too seldom mix.\u00a0 They don\u2019t go to the same ABA meetings, their spouses don\u2019t dine together, their kids are on different soccer teams.<\/p>\n
<\/p>\n
Yet each has skills that the other would benefit greatly from developing.\u00a0 Deal lawyers have an approach to problems that litigators would do well to adopt.\u00a0 And litigators use tools that deal lawyers (and their clients) would benefit from.<\/p>\n
Deal lawyers are problem-solvers.\u00a0 They see the whole picture. \u00a0Clients who engage them intend to make money by coming to an agreement that benefits them at the same time that it addresses the expectation of their counterparty.\u00a0 There is little on the table except the business, the money, the deal.\u00a0 Each deal lawyer is there to negotiate terms that will benefit the client, make sense to the counterparty, and get the deal done.<\/p>\n
By contrast, litigators are gladiators.\u00a0 Their job is to \u201cwin.\u201d\u00a0 They often don\u2019t see (more accurately, they are not entrusted with) the whole picture.\u00a0 Their clients intend to see justice done, and to extract their vengeance, by making the other party wish it had never been born.\u00a0 There is little in the arsenal except bombs, and success is measured not by money, but by blood.\u00a0 The lawyer isn’t there to make money, or even to save money, but to kill.<\/p>\n
This is true despite everyone\u2019s acknowledgement that we don\u2019t try litigated cases any more.\u00a0 More than 98% of filed cases are terminated by means other than a verdict at trial.\u00a0 They are withdrawn, they are dismissed, or (in the case of many business disputes) they are settled on mutually satisfactory terms that include stipulated dismissal, mutual releases of all claims, and either agreed-upon payment or reformation of the terms of the original deal.<\/p>\n
Clients are, presumably, satisfied with the work of the lawyers who put the deal together through negotiation.\u00a0 Therefore it would, presumably, be advantageous to those clients if those same lawyers negotiated a solution to the problem that gave rise to the litigation \u2013 a solution that ended the litigated claim, provided for payment and\/or reformation of the deal, and a speedy return to business.\u00a0 The mind-set of the transactional lawyer \u2013 that the client\u2019s business is best served by negotiated deals \u2013 is highly valued in dispute resolution, and it is a pity that more transactional lawyers are not involved in resolving business disputes.<\/p>\n
Conversely, deal lawyers perceive the negotiation process as a one-on-one game.\u00a0 They have a high regard for their own negotiation skills, and the suggestion that value might be added through the intervention of a neutral facilitator is not just meaningless \u2013 it is insulting.\u00a0 Deal lawyers want control, they want a clear field for strategy, and they want no interference or meddling.\u00a0 They certainly don\u2019t want to suggest to a client that they are inadequate to close this deal themselves, and need a go-between.<\/p>\n
By contrast, many litigators are highly attuned to the utility of mediation in devising an optimal negotiated outcome.\u00a0 Adding a skilled middleman in settlement negotiations can reduce transaction costs and add value in multiple ways.\u00a0 Mediators can assist lawyers in helping their clients to prioritize their goals, and distinguish between critical terms and those that are less important.\u00a0 Mediators can help to \u201cbundle\u201d deals, linking a \u201cgive\u201d and a \u201ctake\u201d in order to create trades that are of minimum cost and maximum value to both parties.\u00a0 Mediators can coach parties and counsel in negotiation strategies.\u00a0 Mediators can add rigor to the valuation process through decision trees or discounted present value analysis of outcomes.\u00a0 Mediators can assist parties to recognize cognitive barriers in their own or their adversaries\u2019\u2019 assessments, and provoke \u201creality testing\u201d of positions or tactics.\u00a0 Mediators can develop \u201cmost favorable,\u201d \u201cleast favorable,\u201d and \u201cmost likely\u201d scenarios that can have a decisive impact on the value of the claim.\u00a0 Mediators can urge clients to develop best alternatives in the event that settlement negotiations fail.\u00a0 Mediators can push disputants through impasse.<\/p>\n
All of these skills have a place at the deal negotiation table, yet I am unaware of a single instance in the negotiation literature where a deal mediation has actually taken place. \u00a0Michael Leathes, a founder of the International Mediation Institute, notes however that\u00a0there are examples of deal mediations out there. \u00a0In fact, IMI’s portal features a section on deal mediation<\/a>\u00a0and Michael reports that, not only has he served as a deal mediator himself, but he has authored\u00a0a role-play scenario called Global Warming<\/a>\u00a0that is available for use without further permission.<\/p>\n The added cost of introducing deal mediation is negligible, and the risks are nonexistent.\u00a0 Indeed, it has been argued that deals achieved through direct negotiation are necessarily less economically efficient than deals that are mediated, simply because no party in a direct negotiation will reveal its underlying interest, and therefore that interest will not be thoroughly addressed in the final terms. \u00a0One must chalk it up to a mixture of ignorance and lack of imagination.\u00a0 And then there\u2019s hubris.<\/p>\n Deals would be more robust if a skilled, confidential mediator were included.\u00a0 Disputes would be briefer, and end on better commercial terms with fewer transaction costs, if the lawyers who handled them approached them as solvable problems rather than cases.<\/p>\n It\u2019s time for the two tribes to start eating together.<\/p>\n Transactional Lawyers have much to teach litigators — and vice versa.<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[37],"tags":[10,12,38,28],"class_list":["post-1346","post","type-post","status-publish","format-standard","hentry","category-negotiation","tag-conflict-management","tag-culture","tag-lawyers","tag-training"],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.businessconflictmanagement.com\/blog\/wp-json\/wp\/v2\/posts\/1346","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.businessconflictmanagement.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.businessconflictmanagement.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.businessconflictmanagement.com\/blog\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.businessconflictmanagement.com\/blog\/wp-json\/wp\/v2\/comments?post=1346"}],"version-history":[{"count":0,"href":"https:\/\/www.businessconflictmanagement.com\/blog\/wp-json\/wp\/v2\/posts\/1346\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.businessconflictmanagement.com\/blog\/wp-json\/wp\/v2\/media?parent=1346"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.businessconflictmanagement.com\/blog\/wp-json\/wp\/v2\/categories?post=1346"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.businessconflictmanagement.com\/blog\/wp-json\/wp\/v2\/tags?post=1346"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}![\"\"](\"http:\/\/4.bp.blogspot.com\/_o4kq5TNL0Z4\/TGWHo59d7WI\/AAAAAAAAAlk\/_62Q_bM2Hs4\/s320\/shark-lawyers.gif\")
<\/p>\n","protected":false},"excerpt":{"rendered":"