NEGOTIATION PREPARATION

By SCOTT FLEGAL, Flegal Law Office , PA

Preparation. For lawyers, there really is no substitute. Whether preparing a case for a jury trial or preparing for a closing, lawyers know they must do their homework and prepare properly. When pressed, most lawyers will admit that unsuccessful trials and sloppy closings are most often the result of poor preparation.

Trial lawyers know what it takes to get prepared for a trial. Most would never think of commencing a major trial without having undertaken the appropriate amount of preparation. An unprepared trial lawyer can be embarrassed in front of his client, in front of a jury and in front of a judge. Lawyers who handle closings are the same way. If a lawyer is unprepared for a closing, it often leads to embarrassment in front of clients and colleagues. Embarrassment is something we all like to avoid.

But despite our general appreciation for preparation, sometimes lawyers approach negotiations as if they are all about one thing: the bottom line. This assumption tends to limit our preparation. In many instances our preparation consists of asking our client to give us authority to resolve the case - to tell us the least or the most he or she is willing to pay, depending on the circumstance. Then, we head off to the bargaining table. But this level of preparation sells both us and our clients short.

How should we prepare a client for a negotiation? In short, by asking and answering a lot of questions. The first step is to help the client identify and understand their interests. They need to identify what is important to them in the negotiation and why? Those interests can then be prioritized. Next, we try to anticipate and understand the interests of the other side. Which of their interests might be most important to them?

The next step is to make a list of options that might meet some or all of the interests of both sides of the negotiation. Are there any objective criteria that can be used to persuade the other side that certain interests should take precedence over others? Is there a fair process for reconciling the differences between the parties and their interests?

Of course, in every negotiation, it is important that we know with some precision our alternatives if the negotiation is unsuccessful. What will we do if the negotiation fails? What are our likely costs and risks associated with these alternatives? Is there anything we can do to improve them? It is here that the parties must confront and understand the strengths and weaknesses of their legal position.

At the same time, we must be aware of the alternatives possessed by the other side. What might they do if we fail to agree? What are their costs and risks in the event the negotiation fails? How strong or weak is their case?
In most cases, it is important to assess the relationship between the parties. What is its current state? What is its preferred state? How would we like it to be? Can we identify any causes of the gaps between our current and preferred relationship? Are there steps we can take to improve the current status of the relationship?
Finally, we need to understand clearly the level of agreement we are seeking. Is this a handshake deal? How much detail do we need? Do we need to negotiate future contingencies or try to anticipate future problems? Are benchmarks for performance and satisfaction of our agreement required?

If the lawyers and the parties work through these questions, the answers can be of great assistance during the negotiation. Without a doubt, these questions address issues that go well beyond the so-called "bottom line". But in most negotiations, they are appropriate; in many, they can be productive.

Sophisticated negotiators do not approach negotiations in a distributive fashion. They are not looking to simply slice up the pie. Their objective is to painstakingly explore alternatives with the other side to see if somehow the pie can be made bigger. Negotiators refer to this as "creating value" during a negotiation. Some refer to it as striving to create a "win-win" scenario. Regardless of how it is labeled, when the pie is made bigger during negotiations, it usually reflects the best possible result for the parties. Added value in the deal puts money in peoples' pockets, and smiles on their faces. They cannot wait to pay their legal fees. As an added bonus, it sometimes provides an incentive for parties in conflict to put their dispute aside and repair their relationship.

When the parties and their lawyers come to a negotiation properly prepared, it is often possible to negotiate a solution to a problem in a collaborative fashion. Proper preparation will have forced them to confront the strengths and weaknesses of their case. They will have thought about and prioritized their interests, and tried to anticipate those of the other side. They will have searched for possible solutions that meet both parties interests; not just their own.

The bottom line is that no matter what legal forum they occupy, good lawyers prepare their clients and their cases well. In the negotiation context, excellent preparation by all parties at the table can be transformative. Adversarial confrontations become exercises in collaborative decision-making. Collaborative decision-making leads to better decisions. New value can be created. Relationships can be repaired, and embarrassment avoided. For lawyers and for all human beings, that is a win-win scenario indeed.