On paper, the morning and afternoon mediations were barely distinguishable. Both were personal injury actions with clear liability and both appeared to have settlement values in the same range. Despite their similarities, the afternoon mediation resulted in a settlement, but the morning did not. Engaging in a bit of “post-mediation analysis,” it struck me that the reason the parties had reached a resolution in one but not the other was because counsel for plaintiff in the afternoon mediation had been willing to adjust his negotiating strategy to make defendant’s decision more difficult.
The two mediations began the same way, with initial demands that were undeniably excessive. Each defendant responded with an offer that was correspondingly too low. Both plaintiffs reduced their demands by relatively modest amounts, followed by similarly modest increases to each defendant’s offer. It was there that the two strategies diverged.
In the morning mediation, counsel for plaintiff rejected a suggestion that he consider adjusting his negotiating strategy, choosing instead to again reduce his demand by a few thousand dollars. Counsel for defendant, not surprisingly, increased the offer by an even smaller amount. Frustrated, counsel for plaintiff abruptly ended the mediation, forfeiting any chance of learning how much defendant might ultimately have offered had negotiations continued.
In the afternoon mediation, counsel for plaintiff realized she needed to adjust her negotiating strategy and decided to reduce her demand significantly, but did so with an explanation that was carefully tailored to preserve her negotiating credibility. By closing the gap as much as she did, she gave counsel for defendant hope that settlement might be possible.
To his credit, counsel for defendant realized he, too, would need to adjust his negotiating strategy to resolve the matter – albeit for an amount that was likely to exceed his settlement authority. Therefore, he made the difficult decision to seek additional authority even before his next offer. Following several more moves, the parties were able to reach a resolution.
It’s easy to walk away if the parties are too far apart, but much more difficult as the gap closes. Therefore, as you develop your negotiating strategy for your next mediation, ask yourself whether adjusting your strategy might work to your advantage by presenting the other side with a decision that is more difficult to make.
As always, I would be pleased to assist you and your clients in the dispute resolution process. Please don’t hesitate to contact me if I can be of service.
Best wishes . . .
Floyd J. Siegal