The origin of disputes is friction: "the resistance encountered when one body is moved in contact with another." Unless taken in hand there is a sure progression from festering sore to outright conflagration.

Medical metaphors are particularly apt to describe the process of injury and healing, but the prescription is talking rather than fighting. That is why it is recommended parties consider carefully their exit strategy; there is ancient wisdom still in the adage that counsels businesses to look before leaping. Voltaire said of litigation, “I was never ruined but twice; once when I lost a lawsuit and once when I won one.”

The Talking Cure
In the last few years civil courts around the country have been making a sustained effort to encourage parties to resolve their disputes by talking––and, equally important because the two go together, listening––to each other rather than litigating them through trial. The reason for this is simple: litigation is costly in time, money, resources, energy, and physical and emotional health. Unless there is certainty on specific legal issues of law that will efficiently end a lawsuit on summary judgment there is uncertainty in litigating disputes in which there are complex factual issues. Business people are sometimes the last to understand the reality of litigation.

The reality is that the resolution of factual issues are the province of juries, and there is no sure way of forecasting how they will vote. There is also an issue of control. When the resolution of disputes is consigned to strangers (arbitrators, judges and juries) the only certainty is that control passes to them. Thus the reason for this emphasis on talking. It is intended to give parties an opportunity to stop the clock and regain control.

The Role of Imagination
Talking alone is not a cure without imagination. The challenge in resolving contested issues of fact is a three step process, namely assessing the circumstances that ignited the dispute, determining fault or liability, and bargaining for an exit. If the parties see the answers to each of these steps as a mechanical exercise on the path to litigation they have lost an opportunity because they will be “talking past each other.” Once a sore becomes a dispute positions tend to entrench and entrenchment is the nemesis of resolution. What is needed is the injection of imagination.

At the beginning each party has some claim on the other that must be recognized. In many instances neither party is wholly right; or, if one is more right than the other the economic glue that bound the parties in their contractual relationship may have thinned. Certainly something has happened that has to be understood; and whatever this “something” is it needs to be acknowledged, which is best done by finding out the “whys” of the dispute as reported by one’s adversary.

There are two processes for disputants talking to each other. The first is sitting around a table together and listening to each other without intervention of any third party. The second is sitting around tables in different rooms with a mediator to assist the parties in settling their differences. Mediators are like referees, that is neutral as to the parties but in a position to assist in assessing 1) the merits of claims and defenses that too often are not as good as one believes they are; and 2) risks that are certain to occur should control pass to others.

Because negotiation is party controlled it is far more preferable than parties confronting each other in arbitration or litigation where they have no control except to the limited extent of presenting their proofs. Costs rise steeply for each step away from a negotiated resolution.

Three Basic Rules
Striped to basics there are three rules for parties talking to, rather past each other. The first rule is to imagine the other party’s grievance; which means understanding its nature and basis. The default for legal and factual positions expressed by one’s adversary is that they are rational; not necessarily irrational because their positions are in opposition. The second rule is perspective. This calls for parties to make objective assessments of each other’s positions. The third rule is evaluating risk and cost. Settlement should only be unacceptable if the benefits are not worth the cost, but acceptable if the risk exceeds the cost.

I will take each of these rules separately. Of course, they express an ideal. It assumes parties will listen, which is a skill of a different kind than talking, and often underrated as a tool for calculating how to respond to evolving positions. Nothing is gained by talking and not listening.

Rule 1
Negotiating positions by definition exist in time; that is, they are owned for the moment, and meant to be discarded and replaced as necessary as the negotiation proceeds. In this respect, talking and listening as a means of settling disputes is analogous to co-adaptive evolution. Exchanging information provokes ideas that in turn affect positions. It is in this respect that we can say that positions are dynamic.

The achievement under Rule 1 is understanding the other party’s position on a matter that left unexplored is an opportunity lost. Imagination is expressed as each party responds to the other in a series of moves that take into account the next two rules.

Rule 2
Perspective is a relational concept. Near and far should not to be confused. A near disadvantage can be a far benefit. The point of the imaginative exercise is to construct the future; not to be imprisoned by the present. This involves a degree of creative engagement by the parties. Here, negotiators are called upon to distinguish short term loss from long term gain.

A facilitative mediator is particular useful in assisting parties because he or she is not encumbered with any emotional barnacles that for the parties and their counsel are likely to impede imaginative forethought.

Rule 3
Risk and cost are related concepts. Failure to estimate risk can be costly. It quickly becomes apparent to mediators that parties (or one or the other) fail in assessing risk and calculating cost. In proceeding to forums that demand proof signifies a belief in the merit of a claim or defense that at best is a fifty percent chance of success. Failure to take full advantage of a forum in which talking is the principal means to an end leads to losing control to arbitrators, judges, and juries. The greater the risk of arbitration/litigation, the greater the cost of proceeding.

The benefits to the talking cure are exiting from the dispute. The result may not be totally satisfactory but tolerable is better than the intolerable one is likely to experience when control passes to others.

About the Author
Gerald M. Levine is an attorney practicing in New York City. He is the author of the forthcoming, definitive guide and go-to handbook,
Domain Name Arbitration: Asserting and Defending Claims of Cybersquatting Under the Uniform Domain Name Dispute Resolution Policy. He has a litigation and counseling practice and represents clients on a diverse range of legal and business matters from real property and commercial disputes to protection of intellectual property rights. He is on the panel of neutral arbitrators for the American Arbitration Association and a mediator for the Commercial Division of the New York Supreme Court, New York County; and the United States District Court for the Southern District of New York. He has published numerous articles on real estate, arbitration, trademark and cybersquatting. His email address is gmlevine@researchtheworld.com.