If you operate a business, disputes with customers, competitors and other service providers may arise from time to time. Unfortunately, this is part and parcel of ordinary business operations. As a first step, before escalating a dispute to a lawyer, you should try to resolve the dispute yourself by entering into a negotiation with the other party.
This article will discuss the commercial tips and tricks you can use to self-solve your dispute and when you should seek legal assistance.
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What is Negotiation?
The term ‘negotiation’ refers to a discussion intended to reach an agreement. Negotiation is also a type of alternative dispute resolution.
Negotiation is the most common process for settling a dispute without going to court, as you can communicate with the other party to reach common ground. You may engage a lawyer to help you negotiate and put your best position forward for high-value disputes.
Considerations When Negotiating a Resolution
Set out below are some key considerations to utilise when negotiating and trying to resolve a dispute.
| Consideration | Strategy |
| What are the key issues in dispute? | What do both parties want, and why do they want this? Understanding both sides of the dispute can help you find a happy medium and progress the dispute. Further, acknowledging the other party’s needs is helpful to bring the parties closer together and soothe any tensions. |
| Keep things impersonal and unemotional | When parties are in dispute, emotions often run high and may continue to fuel the dispute. This can keep parties from coming to a commercial agreement. However, it is important to put these feelings aside to keep an open and honest dialogue open. |
| Before negotiating, consider the best alternative to a negotiated agreement (BATNA) | Before entering or starting the negotiation, consider the worst and best-case scenarios available if you cannot reach an agreement. Knowing your BATNA will help put the issues at hand into perspective. This includes what points you are willing to settle on, and what offers you will walk away from. |
When Should I Get a Lawyer Involved?
There are times when it is appropriate to get a lawyer involved early. The key factors to consider are:
- the value of the dispute;
- how much money is at stake;
- whether you have the resources to engage a lawyer or court;
- your dispute’s legal and factual complexity; and
- whether there is a risk of ongoing loss or damage to you or the other party if the matter cannot be resolved.
These are the primary commercial issues you and your lawyer need to consider when determining your next steps and how best to progress your dispute. Your lawyer will also need to consider your legal position and the strength of your case before advising how best to proceed.
While engaging a lawyer can be expensive, there are circumstances where it may be necessary to minimise your losses.
When negotiating a dispute, there are no guaranteed or certain outcomes. You should always consider taking a commercially pragmatic approach to resolving your dispute and trying to compromise with or without a lawyer.
If you can reach an agreement by negotiating, you should document the terms and parameters of the agreement and engage a lawyer to prepare a Deed of Settlement.
Key Takeaways
Negotiation is a form of alternative dispute resolution. You can negotiate with or without a lawyer. However, legal advice can significantly benefit you in the long term depending on the value and risks involved with your dispute. Negotiation is generally more cost-effective than going to court. It can also preserve important business relationships and achieve better outcomes than court orders.
If you need help negotiating or resolving a dispute, our experienced disputes lawyers can help as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today on 1300 544 755 or visit our membership page.
Frequently Asked Questions
Negotiation involves discussing with the other party to reach an agreement. You can do this with or without a lawyer, but you should consider engaging a lawyer for high-value disputes.
You can also consider mediation, arbitration, and conciliation before litigation if negotiation fails.
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