By John Lande
In an all-too-common pattern in litigation, settlement comes only after the lawyers engage in adversarial posturing, the original conflict escalates, and the parties’ relationship deteriorates. It costs a lot, takes a long time, and none of the parties is happy with the settlement. Almost any disagreement can escalate the conflict and divert energy from the tasks needed to resolve disputes efficiently.
Although some lawyers enjoy this process and make a good living from it, many would prefer to use a more constructive and efficient process. They know that most cases eventually will settle–but often only after a process that takes too long and costs too much–and they feel powerless to steer clients toward a more productive path.
They are often trapped in a “prison of fear” that locks them into unnecessarily long and expensive litigation. They fear that the other side would interpret the mere suggestion of negotiation as a sign of weakness and an invitation to take advantage of their clients. Logically, this is absurd because people with strong cases should be interested in early settlement under favorable terms. But this fear still grips much of the legal profession.
Lawyers also sometimes worry that they will lose revenue if they negotiate early in a case. Many lawyers are still afraid to suggest anything but the traditional hourly billing system, which incentivizes inefficiency.
ESCAPING THE PRISON OF FEAR
Lawyers sometimes do escape from their prison of fear. They help clients assess the benefits and risks of negotiation, let the other side know of their interest in negotiation–but willingness to litigate if necessary–and cooperate with the other side in a constructive planned early negotiation, or “PEN.”
In PEN processes, lawyers can maintain or increase their revenue by offering creative compensation arrangements that satisfy both clients’ and lawyers’ interests. They can design fee arrangements that provide bonuses for achieving clients’ goals and resolving matters relatively quickly. Sharp lawyers can generate efficiencies, share the savings with clients, and thus increase their effective hourly rates.
PEN is not appropriate in every case but when it is, it is a useful tool for lawyers to satisfy many clients and make money by using their time more efficiently.
Part II will describe how to initiate and conduct planned early negotiation.
This description is adapted from an article that will appear in a fall issue of Alternatives to the High Costs of Litigation, published by the CPR Institute. It is based on my book, “Lawyering with Planned Early Negotiation: How You Can Get Good Results for Clients and Make Money” (ABA 2011). For more information about the book and to order it, click here. The book includes numerous practical forms on a CD for lawyers to use in their own practices.
John Lande is Director of the LLM Program in Dispute Resolution and Isidor Loeb Professor at the University of Missouri School of Law. He teaches courses on lawyering practice, non-binding methods of dispute resolution, and dispute system design.
He began mediating professionally in 1982 in California. He received his J.D. from Hastings College of Law and Ph.D in sociology from the University of Wisconsin-Madison. He was a fellow in residence at the Program on Negotiation at Harvard Law School. Before coming to MU, he was on the faculty in the Dispute Resolution Department at Nova Southeastern University and he was Director of the Mediation Program and Assistant Professor at the University of Arkansas at Little Rock School of Law, where he supervised a child protection mediation clinic.
The Legal Trends Network identifies him as a legal trendsetter. For more about his background, read the interview from the ABA Section of Dispute Resolution’s newsletter and Gini Nelson’s interview of John from her “Engaging Conflicts” blog. Professor Lande may be reached at firstname.lastname@example.org.