Is Negotiation Better Than Litigation?
One of the most challenging decisions that parties often face while resolving disputes is whether to negotiate or litigate. While some people are naturally inclined towards litigation, negotiation can be a viable alternative in some situations.
A lawyer with effective negotiation skills can help achieve your desired outcome without going through expensive and exhausting court processes. The article below will explain whether it is better to negotiate or litigate and how a lawyer can use their negotiation skills to help resolve disputes on favourable terms.
Litigation and negotiation are the most common methods of dispute resolution. Litigation involves conflict resolution through formal court processes. In contrast, negotiation is the strategic discussion of issues among the parties to resolve a dispute in a mutually acceptable way.
Most legal professionals regularly negotiate and settle cases outside the court. Negotiation is generally preferred where the facts are undisputed, legal issues are straightforward, and the damages sought do not warrant engaging in the complicated and expensive litigation process.
However, choosing between litigation and negotiation becomes challenging when the dispute raises complex legal issues which may benefit from judicial determination. In such cases, parties must weigh their options more carefully before deciding whether to negotiate or litigate.
Is It Better to Negotiate or Litigate a Dispute?
Negotiation refers to any direct or indirect discussion between the disputing parties to resolve the conflict outside the traditional court system. It facilitates a confidential settlement between the parties without a formal legal judgment on the issues.
Negotiations are usually confidential, meaning only the negotiating parties would have any knowledge regarding the matter, offers to settle and the settlement terms. While negotiating, parties can discuss issues candidly without fearing the disclosure of sensitive and potentially damaging information.
Additionally, negotiation allows the parties to find creative solutions to their legal problems. They can adopt any settlement terms and negotiate any non-monetary remedy a court would not be able to award.
Litigation is the process for individuals to resolve disputes by suing through the courts. Individuals usually litigate in hopes of a higher damages award and to have their day in court. The court may also award legal costs to a successful party on a partial indemnity (some costs) or substantial indemnity (most costs) basis.
Both negotiation and litigation have their advantages. Depending on the facts of a case, using both processes together may achieve better results than pursuing either method independently.
Negotiation is usually the first step in the dispute resolution process, and parties can engage in litigation if the negotiations fail. The term “litigotiation” refers to the strategic pursuit of a settlement through mobilizing the court process.
Some negotiation processes are built into litigation itself. For instance, the court awards higher costs for making a Rule 49 Offer to Settle. Further, the mandatory mediation for civil actions commenced in Toronto, Windsor, and Ottawa ensures parties negotiate even while litigating.
Negotiation has an undeniable role at all stages of dispute resolution. Therefore, a negotiator should possess effective negotiation skills to settle disputes on their preferred terms.
Negotiation Skills A Negotiator Must Possess
In negotiation, each party tries to convince the other to agree with their position. It usually involves some back and forth between both sides, which means one side usually comes out on top, and the other concedes some ground. For this reason, a negotiator must possess certain skills which may help them resolve the dispute on more favourable terms.
A negotiator entering negotiations with the intention of arguing and convincing the opposite side of their position’s strength may not succeed. Instead, they should focus on getting relevant information such as the other side’s negotiation history, interests, needs, and options.
In addition, a negotiator who considers the interests of the other side while proposing settlement options is in a better position to settle than someone who is focused on imposing their will on the other side.
They should also try to maximize their leverage while negotiating. They may do so by showing the opposite side that they are willing to take the case to trial. However, while demonstrating readiness for trial, the negotiator should not come across as unwilling to settle. Their actions should indicate they are receptive to reasonable settlement offers but are prepared for trial if the negotiations fail.
The parties at the negotiating table should be prepared to offer some concessions to each other. The techniques involved with this approach include increasing the number of issues for bargaining or “enlarging the pie” before dividing it.
How a Lawyer Can Help in Negotiations
While you may represent yourself in negotiation, the settlement process can become stressful and confusing. Where you might save some cost in negotiating without a lawyer, such a decision could result in you settling for less than your entitlements.
Lawyers are skilled negotiators who can use their knowledge and expertise to assist you during negotiations. They can undertake a Best Alternative To a Negotiated Agreement (BATNA) analysis to help determine your bargaining position. BATNA is the standard against which every proposed settlement agreement is measured. BATNA analysis can protect a party from accepting too unfavourable terms and rejecting terms it would have been in their interest to accept.
A lawyer can develop a negotiation strategy based on the strengths and weaknesses of your case and your BATNA. A lawyer will review the facts, understand the nature of the dispute, and consider your goals to determine your bargaining position. They can advise you on your settlement entitlements based on your bargaining position and will engage with the opposite side and try to get the most out of the process.
If the settlement negotiations fail, a lawyer can bring a claim on your behalf to the court. The litigation process is riddled with complexities and technicalities. A lawyer is a trained legal professional with experience in navigating the legal system. They can use their knowledge of the law and legal process to help you at each stage of the litigation process.
Like many legal questions, the answer to whether it is better to negotiate or litigate a matter depends on the specific facts of a case. Both litigation and negotiation have their relative strengths and weaknesses. Using the strength of both processes to overcome their individual weaknesses can help resolve disputes effectively.
Most dispute resolution processes involve negotiation. A negotiator with requisite negotiation skills can ensure compromise on more favourable terms. Lawyers spend most of their time negotiating and settling cases on behalf of their clients. They have the requisite negotiation practice, experience, and expertise to protect their client’s interests during negotiations.
If you are pursuing a legal matter and want to know more about negotiation tactics or want assistance in potentially reaching a settlement, our team of experienced lawyers at Achkar Law can help. Contact us by phone toll-free at +1 (800) 771-7882 or email us at [email protected], and we would be happy to assist.