Dispute Resolution: What do clients really want?

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In a word, efficiency. A more efficient way of getting disputes resolved effectively, while minimising waste, including time and money.

Yes of course parties want justice and resolution. But, according to last week’s Global Pound Conference Report, they also want an efficient way of getting it, and more thought and engagement needs to be given to bringing appropriate resolution in acceptable timeframes and at realistic costs. That means clients and advisors being clearer, not just about what they want to achieve, but about the best way of getting ‘the other side’ to give them what they want.

The report recommends looking at ways of resolving disputes that combine adjudicative and non-adjudicative methods, and being more flexible and collaborative than has traditionally been the case. Yes, I know. Sharp intake of breath. But not for a new generation of lawyers who have grown up in an information sharing culture.

There was near universal recognition from contributors that parties need to be encouraged to consider processes like mediation before they commence adjudicative proceedings and that non-adjudicative processes, like mediation or conciliation, can work effectively in combination with litigation or arbitration. And before you say it, this new ‘universal wisdom’ wasn’t just from self-interested mediators, but also from parties and end-users, in-house counsel, private practice lawyers, judges and arbitrators.

Reading the report, what resonated for me is that if more thought needs to be given to designing appropriate resolution processes and encouraging greater collaboration, that’s where experienced neutrals can really assist by making the process easier, more effective and more efficient. If you would like to talk to me more about this either for a particular dispute, or generally, please call me on +44 (0) 207 286 0272.

If you would like to read the report in full: here’s a link: https://www.herbertsmithfreehills.com/latest-thinking/global-pound-conference-series-redefining-dispute-resolution

The report also concludes that while disruptors like technology and globalisation have changed the business landscape beyond recognition, dispute resolution processes haven’t yet caught up. Coincidentally, I have been invited this week by the Law Society Gazette to contribute to a round-table discussion about how technology can drive dispute resolution efficiencies and I will be blogging about this shortly.

The problem is ‘they’ don’t get it…. Sound familiar?

I get told this a lot in mediations. By both parties, sometimes.

Isn’t it strange though how we can be so adept at spotting the limitations of someone else’s argument, but myopic about our own position. We think of ourselves as rational animals – especially us lawyers – yet when it comes to changing our mind, we are constrained. Why is that?

1 Confirmation bias. Firstly, we give greater credence to evidence that confirms our hypotheses than we do to something that disputes it. That’s because, according to neuroscientists, when someone confirms what we already believe, we get a dopamine rush, like we do when we eat chocolate or fall in love. And when you write something down, it apparently makes it even harder to change your mind.

According to Channel 4 News’ undercover investigation, Cambridge Analytica claimed that its campaign won the US presidency for Donald Trump. Explaining the secret of its success (and its creative ‘Defeat Crooked Hillary’ campaign), CA’s managing director, Mark Turnbull said:

‘It’s no good fighting an election campaign on the facts because actually it’s all about emotion. The big mistake that political parties make is that they attempt to win the argument rather than locating the emotional centre of the issue, or the concern, and speaking directly to that’.

2 Cognitive dissonance. If someone challenges what we believe, our instinct is to look for ways of neutering that challenge. The greater the discrepancy, i.e. the more it threatens our beliefs, the harder we find it to acknowledge that we may be wrong. And the more we seek to prove our confirmation bias *. Similarly, and I will revisit this in a future blog, when we do something wrong and are confronted about this with evidence, instead of changing our point of view, we tend to justify it even more tenaciously.

And they say litigation is polarising!

Do you agree? Or is that because you already knew this?

* One way to unlock this intransigence, is to get the person to rethink their assumptions and look at the situation differently, for instance, by asking them something like, ‘Have you ever seen a situation where the opposite was true?’. This blog was inspired by Tim Adams’ excellent essay ‘On the one hand’ (Observer: 25.02.18). In it, he explains why people find it so hard to change their mind on big issues like gun control.

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What if the ‘other side’ won’t listen?

What do you do when you have a dispute and the real problem is that the other side won’t stop litigating? Your client wants to stop the dispute, but ‘they’ won’t let them. And your client is manacled to them.

Well, try mediating it.

If the parties don’t trust each other, they probably aren’t listening to each other either. But they will listen to your mediator, so use your mediator as the bridge to get the other side to see things differently.

If the issues have already been aired, rehashing them again in a joint session may only alienate. So get the mediator to ask questions instead. To help people put together the missing pieces, and see things from a different perspective. Or to change the dynamics, say by drawing up on a whiteboard the bones of the settlement agreement, so that people can see just how few outstanding pieces they need to settle the dispute.

Like it or not, it isn’t what you say. It’s what they hear.

So let them hear it from someone else. Maybe that way, they’ll listen

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How to disagree well

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You don’t have to agree with what someone says. Or back down either. But if you want to disagree effectively, ‘Don’t raise your voice. Improve your argument’*. Concentrate on the content and be as specific as you can.

1 Don’t let feelings cloud your judgement

Take a step back and think about two things:

• What’s the best way of explaining the weaknesses of their argument as clearly and persuasively as possible

• What’s the best way of doing so without either of you becoming angry, defensive or resentful

In other words, attack the problem, not the person. Look for common ground. If you are open to them being better off too, you are more likely to build trust.

2 Don’t hide behind email

Do it face-to face. Because, when people meet, things happen.

3 Don’t fret. Hire a mediator

If managing the meeting yourself feels daunting, or you don’t feel confident about the prospects of resolving the problem, hire a professional mediator to manage the process and help sort it.

4 Don’t just lead with the facts. Let them talk

Show them you are listening. Acknowledge any emotions and identify the issues. Then dig deeper. Find out what they want, and find out why they want it. Discover what their emotional driver is, and you can create more options.

5 Watch the body language

Look for clues about how they feel and respond accordingly. Remember to watch your body language too.

6 Don’t be combative. Be good-humoured

Apparently, people are six times more likely to get a deal with someone they like. Don’t let them feel they are getting hammered. Better still, where you can, express what you want in terms of what they need.

Finally, don’t let it linger. If it escalates, it will get worse.

* Desmond Tutu. This blog was inspired by a recent article written by Daniel Goleman, author of ‘Emotional Intelligence’, for Korn Ferry. https://www.kornferry.com/institute/how-to-disagree-well

Mediate. Don’t drag your feet. A warning from the Court of Appeal

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Lord Justice Jackson recently delivered a clear message to parties who play for time when agreeing to mediate.

‘In a case where mediation is obviously appropriate, it behoves both parties to get on with it. If one party frustrates the process by dragging its feet for no good reason, that will merit a costs sanction’. *

Jackson’s judgment extends the message sent by the Court of Appeal in PGF II **, that ‘to remain silent in the face of offer to mediate is, absent exceptional circumstances, unreasonable conduct meriting a costs sanction, even in cases where mediation is likely to succeed’.

This ruling is another reminder that the courts expectantly litigants to be proactive and engage constructively with one another during proceedings, and to properly explore the potential to mediate a dispute.

I find there is often a few months delay between the parties formally agreeing to mediate and actually getting to the table. This ruling is designed to make litigants think twice about using logistical “difficulties” cynically as a delaying tactic.

What it means: Avoiding mediation is no longer an option. Parties cannot refuse to mediate, ignore requests to mediate, or pay lip service to an agreement to do so. If they do, cost penalties are likely to be imposed.

‘Resolve any Dispute in a Day’: Thursday, 18 May: Finally, I have three places left for next Thursday’s round-table workshop, explaining how to broker deals, prevent disputes escalating, or settle just about any dispute on the right terms. If you or a colleague would like details, please let me know.

* Thakkar -v- Patel [2017] EWCA Civ 117
** PGF II SA v OMFS [2013] EWCA Civ 1288

Mediation: The chain of pain and how to get off it.

Click on this.  Familiar, isn’t it?

I drew it while reading Sarah Barclay’s excellent study about paediatric services[1]. It shows how conflicts escalate and pinpoints warning signs. Looking at the diagram, I was struck by three things:

1. In contractual disputes, you often see a ‘chain of pain’ like this. Possibly, also complicated where people are communicating by email. Not face to face.

2. Our views tend to be amplified by the illusion that we are right and the other person, deluded. As George Carlin said ‘Have you ever noticed that anybody driving slower than you is an idiot, and anyone going faster than you is a maniac?’

3. If the protagonists can’t resolve matters, this is the likely continuum. Then, somewhere along the line something boils over or someone reaches for a litigator and the conflict mutates again.

So why is it relevant?

Because it shows two other things too: - 

a) How much more is often at stake. Whether it is a boardroom dispute or a band dispute, an inheritance claim or a contractual one, it is also about financial issues, relationships, egos and reputations. Not things the courts are particularly good at dealing with.

b) How much easier resolving things can be if you know how to intervene early enough. Less expensive and destructive too.  Think of it as business marriage guidance. With someone who can listen – to the words but also the gaps in between – and who can help everyone sort things out there and then.

So that you get off the chain before it escalates. Or better still, avoid it completely.


[1] ‘Conflict escalation in paediatric services: Findings from a qualitative study’, Liz Forbat, Bea Teuten & Sarah Barclay https://www.researchgate.net/profile/Sarah_Barclay3/publications

Settling a dispute: 10 things that can unblock an impasse. Or go horribly wrong.

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Negotiating is like making sausages. It is not an attractive process and it is best done in private. If you hit an impasse, find a new option. If need be, invent one. Momentum can be key. Here are 10 possibilities worth considering (culled from Jonathan Powell’s book ‘Talking to Terrorists’). But be careful. They can backfire.

1 Break bread. Preferably, before you meet and not just to talk about the dispute.  You may see things – or each other – differently.  I have even known it to work and make the formal meeting redundant

2 Have a Plan B. Henry Kissinger though used to advise against doing so. Or at least telling your negotiators in advance

3 Find an ambiguous form of words on which everyone can agree while they wait for something to change. Lawyers hate this one. Sooner or later ambiguity becomes destructive. Short-term though, it allows people to interpret the words the way they want

4 Link things. Tie progress on one issue to progress on another but again, long term, this can jam up negotiations

5 Set a deadline – Arbitrary deadlines can be risky but ‘hot-housing’ can be invaluable

6 Lose your temper. But only deliberately. And at the right time

7 Walk out. With one caveat. John Major walked out after Ian Paisley called him a liar and refused to withdraw the smear.  Paisley then staged a sit-in. Unfortunately for Major, the meeting had been taking place in the Cabinet Room at Number 10

8 Consider sunrise & sunset clauses. Where you are up against an issue of fundamental importance to one party that is unacceptable to another, enshrine that issue in the agreement but defer its implementation until that party has met the necessary conditions for transition

9 Trust, but verify. It is precisely because you don’t trust each other that you need to have an agreement. Only implementation creates trust

10 Keep your agreement as simple as a set of home appliance instructions. In fact, keep it simpler

Finally, sell your agreement aggressively. Especially with your own side. As Gerry Adams said, the hardest negotiations are always the ones ‘with your own band’

 

Getting the most out of a meeting: The 10 Do’s and Don’ts

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In my last blog I wrote about Jonathan Powell’s book ‘Talking to Terrorists’. This week, continuing the theme, 10 ‘Do’s and Don’ts’ on the day.

1 Agree something, even something minor, early to build confidence. Or put a proposal on the table so attractive that the other party simply cannot afford to walk away

2 Listen for nuances. For what people are, and aren’t, saying including ‘the gaps that indicate what they aren’t ruling out’

3 Ask ‘why’. To ascertain what their real position is or why symbolic issues are important to them. Especially as these tend to be more significant than substantial

4 Cut to the chase. Get to your bottom line quickly. If you are clear and consistent they will understand your signals and be more willing to settle quickly

5 Don’t play tricks. Outwitting someone rarely lasts. It just undermines your trustworthiness. Or as Henry Kissinger revealingly said ‘It is essential to cultivate the appearance of reliability in negotiations’

6 Be patient and phlegmatic. Mediation is like jazz. It is not linear. Sometimes, when things ‘look like they are surging ahead they are in fact about to collapse’. Or when they seem at their bleakest, there’s about to be a breakthrough. Focus on your ultimate goal. But be flexible on tactics

7 Know when to stop haggling. There’s often a critical point at which marginal gains aren’t worth the loss of confidence. The deal will either rapidly come together then or stagnate.

8 Beware of spoilers… They can bring negotiations crashing down. Whether they do or not depends on how you react. Stay calm. Maybe even offer a sweetener so that they feel they have won something late on. Better they sign with a smile than a grimace.

9 … or an outbreak of ‘buyers remorse’

10 Win control of the pen. If you can’t, think about counter-proposals that sound the same but work in your favour.

In a couple of weeks, tactics worth considering but that can sometimes backfire. Like ‘finding an ambiguous form of words on which everyone can agree while they wait for something to change’, a skill that Robert Cooper characterised as being essential for diplomats.

Making mediation work: what we can learn from talking to terrorists

Eighteen years ago last Friday the Northern Ireland peace process was signed.  Jonathan Powell, Britain’s chief negotiator, has written ‘Talking to Terrorists’, an invaluable read for anyone interested, or caught up, in conflict.  Packed with fascinating stories about various peace processes, leaders and negotiators it contains a war chest of insightful nuggets, many of which are as relevant for commercial mediation.  This week, I concentrate on starting the process.

1 Should one sit down and talk with the other side?

‘In the end, you have to… It is a question of when and how, not whether’ and the same principle applies to commercial mediation, given that over 60% of High Court cases end up being mediated.  ‘It may not always be the right moment… but it is always right to talk, because ‘negotiating is not a question of forgiving or forgetting the past, but holding a pragmatic position about the future’

2 When’s the right time?

JFK said ‘It is never too early to try: and it’s never too late to talk’.  The trick is in determining how best to ‘ripen the conflict’

3 Why is a ceasefire important?

Because ‘the longer it goes on, the harder it is to go back’

4 What about setting pre-conditions to a mediation?

Beyond insisting on a ceasefire, ‘almost always a bad idea’

5 But isn’t mediation about compromising?

No, not if you mean ‘giving away your position’. Compromising is  about ‘working out what the other side’s interests are and seeing if you can meet them without sacrificing your own’.  Powell talks about Mandela’s ‘willingness to make concessions, but not about what was important to him.  With respect to his key principles, he was unmovable’ and would deflect unwelcome proposals with the words ‘But something else could be considered’

6 Why is sitting face to face important?

Because otherwise you can’t be certain how far the parties really agree.  ‘You need to meet to see their body language… The debates may be more emotional as a result, but they can have a cathartic effect that makes a lasting agreement possible.

‘The very act of negotiating can build trust’.  This can be particularly important where there is also a relationship involved.    Finally, my favourite quotation, which captures the essence of what mediation is about:-

The good news is there is light at the end of tunnel. The bad news? There is no tunnel.’ 

That’s the challenge. Constructing the tunnel. 

The 6 things you need to settle a dispute – and something else I do as a mediator *

Most people find it harder to listen to people they are arguing with or don’t like. It requires effort and discipline. The challenge is not getting people to talk but getting them to listen.

While no disputes are the same, when it comes to settling them the methods used are often strikingly similar. Six principles apply. George Mitchell, the US Senator who chaired the Northern Ireland peace talks referred to them in the context of brokering peace settlements but they are as pertinent, irrespective of whether you are looking to settle a commercial dispute with another business, a professional negligence claim, a probate case or a partnership fall-out. Here they are:

1 Preparation: People need to understand the history and be properly informed. To this, I would add two things. They need to understand the people and what would sway them. And they need to be able to move on from ‘How we got to this’ to ‘Where do we go from here?’

* As a mediator, where a case warrants it, I also like to meet the protagonists and their team individually for a confidential chat a few days before a mediation. I find this improves the chances of the dispute settling. It also accelerates the process and I know how many lawyers are fed up with mediations that only seem to get going at 3pm. It can be invaluable where feelings are running high or where a party hasn’t mediated before or doesn’t appear to understand someone else’s business.

2 Ownership: The protagonists need to take ownership of the issues. Because they are going to have to live with the consequences.

3 Know your objectives and your bottom line: And theirs too.

4 Perseverance: Keep focused on what you want to achieve. Keep moving forward.

5 Patience: You need a reservoir of it. There will be setbacks. As Mike Tyson said ‘Everyone has a plan until they get punched in the mouth’.

6 Be prepared to take a risk & lead by example:  Sometimes you need a spark to drive the wheel of change – especially if you are operating against a backdrop of mistrust or a disintegrating relationship.

In my next blog, I will be writing about what you can learn from talking to terrorists and about being prepared to take a risk.