Guy O. Kornblum, A Professional Law Corporation

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Guy O. Kornblum, A Professional Law Corporation


Over 40 Years Of Success.
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| Mar 15, 2021 | Articles

My experience with clients today is that they want (and perhaps even expect) their case to settle. They want to avoid the stress and delay of a trial, and also the risk of an unacceptable result (to them). So the first question after “What is my case worth?” is: “Can you settle my case.”

So educating the client about process and prospects of a resolution short of trial should and usually begins at the first client meeting.  And its discussion early on is important to successfully settling clients’ cases because obviously they hold the authority to settle. So it is important to have a dialogue with clients about the negotiating process and begin educating clients about how this all works and what their expectations should be for a settlement instead of a trial.

Here are some thoughts on how to educate and prepare clients on settling their cases:

  • Prepare for the Process: You need to prepare clients for the negotiating process by first educating your client to have the right attitude towards settlement.  This means explaining the various alternatives that are available, and when they might be an advisable part of the effort to settle the case.  To help accomplish this, I explain the difference between direct negotiations, a court supervised settlement conference or mediation, and a mediation through a private dispute resource.
  • The Timing: I also inform the client about the level of preparation needed to posture the case to get the other side interested in negotiating.  And explain that this might be accomplished through a “demand letter” or a simple conversation with opposing counsel at the “right” time. Or it might be addressed at a Case Management Conference.  No matter how it happens, the client needs to know it does not happen overnight and a good bit of work needs to be done before negotiations can begin.
  • “Settlement” Ain’t a Bad Word: Hence the title of this commentary. Showing interest in settling is not a manifestation that you don’t believe in your client’s case.  Instead it can show confidence in the facts and the applicable law, and illustrate your experience and wisdom in handling the matter.  Also, by reaching out to the opposition, you can begin the process of educating the client.
  • Understand Confidentiality and What that Means: I also make sure the client understands that what takes place during negotiations is confidential.  I stress that anything said during negotiations, whether direct or through mediation, cannot be brought up in court during trial if settlement efforts are not successful.  Clients often are surprised at this. They need to know that they will not be prejudiced by the process.
  • Get Down to Business: Settlement is where clients learns the business side in resolving disputes.  It is important to talk about numbers at a stage where they become important – usually when costs begin to significantly increase and start to reduce the “net” to the client and counsel. So it is important to recognize when the cost going forward significantly increases and advise clients accordingly.
  • It’s the Client’s Decision: I stress that it is the client’s decision whether to settle, and I make sure the client has all necessary information to make an informed decision about whether or not to settle.
  • A Chance for an Objective View of the Case: I explain that an advantage of  mediation is that it provides a chance for us to get an objective view of the case. A mediator will often comment on the issues and give his or her views on each side’s pros and cons in settling versus further litigation.  This provides an objective, third-party’s view of the matter, which is valuable.
  • Using the Proper Words: The proper words should be used in getting the client ready for mediation (or for settlement for that matter).  Words like “victory,” “doing battle,” “defeating the other side,” or war and combat slogans have no place in getting a client ready for negotiations and setting the right tone for the negotiation process.  This is not war; this is negotiation and compromise, so words appropriate to that process should be used.  I prefer words like, “educating the other side about our case,” “working with the mediator [and the other side] to resolve the dispute,” “resolution,” “settlement,” and “compromise.”  I also stress that we are not giving in, and these words don’t mean that.  I remind the client that it takes all parties having the same attitude to get a settlement that works for all.
  • Settlement is Voluntary; There is No Decision Unless All Agree: Some clients think a mediation is an arbitration and the neutral will decide the case.  I stress that no one is forcing the parties to settle.  A deal will be done only if all agree to the terms and conditions. No one is going to shove a settlement down a party’s throat; they should not even try, although sometimes a little persuasive effort is encouraged to illustrate what a settlement means for the client’s case, and how the client can benefit from this process.
  • Does the Client Need a “Number?” I try to avoid giving the client a predicted range, although sometimes it is necessary to get a client to think in terms of a realistic figure for settlement.  There are three ways to approach this:
  • Don’t give the client a number at all, but tell the client that a “demand” should be made first (if you are the plaintiff), and you and the client need to see how the defense responds and what the mediator says before you think numbers;
  • Give the client a reasonable but fairly wide range for settlement, suggesting that the ultimate number will be affected by how the defense postures during the mediation and how effective the mediator is at moving to a higher number;
  • Just set a rock bottom “walk away” number and work from there.

One of the major tasks in preparing for mediation, and any settlement negotiations for that matter, is to inquire about a client’s expectations of how a settlement will benefit them.  This involves advising the client of the pros and cons of a settlement:

  • The costs of further proceeding;
  • The certainty of a settlement versus the uncertainty of a trial or arbitration;
  • The emotional drain on the client and family or business partners;
  • Adverse publicity that might result;
  • Public “airing” of personal life and issues, particularly sensitive medical or psychological problems;
  • The present value of money in hand versus the chance of a greater gain at trial [which after affixing value to the two, can vary greatly, and in fact, lower a client’s unrealistic expectations];
  • The positive impact of having money now for life planning rather than the long wait through trial and appeal.

I try to explain the major points in favor of a settlement, and that at its core settlement is a business approach to resolving disputes.  The clients should be ready to engage in this process and understand that this can be a productive, positive way for resolution, and that the client has control over the outcome! Obviously, that is not true if the case is left to a jury’s discretion.