Even Competitive Negotiations Can Benefit from Collaboration

Often when I speak to other lawyers about alternative dispute resolution, they point out that many of the disputes with which they deal are inherently competitive, i.e. they are “zero sum”, “win-lose” situations. I am not ready to concede that the disputes are inherently competitive as they claim, but I do recognize that by the time lawyers get involved they have frequently become competitive and that any relational aspect that they may have had may be beyond salvage. Moreover, lawyers, if they are trained at all, are trained in competitive negotiation, so every situation looks competitive to them. (This is an example of the phenomenon illustrated by the old saying that if the only tool you have is a hammer, everything starts to look like a nail.)

How can you make competitive negotiation something more than a game of bluff and bluster? I can’t tell you how many times I have gone into negotiations expecting an argument, like the character in the famous Monte Python sketch, and end up in a series of pointless contradictions. This leads almost inevitably to a speedy impasse.

One good away out of the dilemma, assuming that someone on the other side has any skills at all, is to put numbers aside and to start talking about “principles”. Even a purely competitive negotiation can become somewhat collaborative with respect to the “process” by which it will be settled. After all, the parties have a mutual interest in reaching a compromise and keeping transaction costs down and should be receptive to working on how to bring this about. The immediate issue becomes “what principles will we employ to arrive at a number?”

Each party has some basis for its offer or demand, and the process will be advanced if time is devoted to listening to and understanding where the parties are coming from. The opening salvo is usually based on the expectation that the negotiation will consist of trading concessions back and forth off of some arbitrary numbers; therefore, the demand is always exaggerated and the offer low-balled. Put these numbers out of your mind and focus on principles, and you may have a chance to get to something relatively quickly that the parties can live with as “fair”. In any event, even if you don’t settle, you will have set the stage for future discussions, something that trading naked numbers will not accomplish.

If I were cynical (and I am), I might suspect that one of the reasons that lawyers favor competitive negotiation techniques is precisely because they so often do not work. Lawyers stand to gain from extended controversy and settlement on the eve of trial or while the jury is out. By then, they have earned gobs of fees.