Bringing people to the negotiating table
Updated: Mar 24, 2021
The business owners I meet tend to be quite reasonable people, in that they usually want to end a dispute quickly and in an amiable way so that they can preserve the business relationship. They are usually confident that once they have an open channel to the other party, both sides can usually agree on how to resolve the dispute and move on. However, once in a while they will meet someone who refuses to talk to them or insists on having the court try the dispute, and they ask how to get these people to open up for discussion so that everyone can move on with their business and life.
It's this type of situation, where one party faces a stone wall or someone who is openly hostile, where I like to offer some ideas about getting the other party to participate in mediation. My understanding of mediation is a private session between parties in a dispute, with a neutral third party present to facilitate a settlement, and whatever is said in the meeting stays in the meeting. So it is not just another meeting between parties for the purpose of negotiation.
It would be great if you had a previous agreement with the other party to go to mediation in troubled times such as these, but if not, then you need to give them an objective reason to consider going for mediation.
A surefire way to create a sense of urgency to go to mediation is to start legal proceedings against the other side. When you start a suit, you force the other side to respond for several reasons:
1. Any document with the court's seal is bound to draw any reasonable person's attention to it. This is usually enough to get the other side to go look for legal advice.
2. A defendant has at the most 22 days to put up a defence once he or she is personally served with the documents. Failing to do so means that the plaintiff can apply for judgment in default and he will get what he asks for most of the time, such as a specified sum of money. Of course, if the other side has empty pockets then there may not be much motivation to participate in court proceedings and chalk up a legal bill.
3. Usually people who are new to court proceedings will ask for cost estimates, and most of the time they will find it quite hard to swallow. This immediately creates a context for suggesting mediation as a less expensive and long-winded alternative.
4. Having parties take clear positions on what happened and who's responsible gives you a good idea of what you can expect to hear at mediation, such as some possible objectives the other party wants to achieve (get some money? Make the dispute go away?). This is particularly useful for court-based mediation, where the time allocated is short and you don't want to spend too much time figuring out what exactly the other side wants.
Another method which works sometimes is to appeal to the parties' relationship, even for commercial settings. This works when both sides want to continue working with each other and are concerned about escalating the dispute too far. This worked out for a subcontractor client who could not agree what “relamping” meant, but both parties recognised that they still wanted to work with each other and agreed to spend time in mediation to find a solution. In the end, they managed to come up with a threshold to decide when and which party would foot the cost of certain items in the scope of work.
Getting parties to agree to mediate is only the first step. But it is an important step to resolving your business disputes efficiently and freeing up your time for more profitable activities.
Are you a director-shareholder of a company looking for counsel who can start legal proceedings but know when to hit the brakes in favour of negotiation or mediation? Write to me at firstname.lastname@example.org or message Boon Gan Ng on LinkedIn for a quick, no-obligations discussion.