WHEN SHOULD NEGOTIATION BE CONSIDERED?
o The parties do not want a neutral third party present and want absolute control over the result of the conflict
o
The parties are able to communicate effectively
This should be used when it is evident that the client is not overcome with strong emotions and is willing to compromise and cooperate when reaching an agreement. They are also ready to actively listen, reflect on what is being said and talk effectively.
o The client is seeking mutual benefit and wants to maintain the relationship
o Desire to keep the dispute confidential
ADVANTAGES
o Quick settlement
o Cost effective
o
Parties have control over the decision
o
Confidentiality: communication
is without prejudice and cannot be adduced as evidence (see s 131(1) of Evidence Act 1995 (Cth))
o Communication lines are opened
Allows parties to communicate and gives
them a chance to change the manner within which they had perceived the dispute.
This will also present a client with the chance to remove the negative aspects
of previous breakdowns in communication.
o
Remedies can be tailored to suit individual
needs/interests alongside the underlying legal and/or non-legal issues and therefore resulting
in increased satisfaction with settlements reached
DISADVANTAGES
x Legal rights are not protected as the process is
interest based
X Power imbalances may lead to unjust outcomes.
This process is not suitable for parties within a relationship where there is a significant power imbalance. Stronger and more aggressive parties are provided with an opportunity to
continue to exercise power and control over the weaker party as there are no
procedural protections.
x The absence of a third party neutral
With no third
party present in the room, chances of reaching an agreement may be limited as
there is no facilitator clarifying the issues and identifying best alternatives
available to each party. Clients should therefore by advised to consider their BATNA (see Fisher and Ury)
x Emotional clients may not be able to communicate
appropriately
x Negotation has no formal discovery process and
relies entirely on the participants’ good
faith.
If the client cannot fully address the dispute without first
receiving information from the other party, there is no way to compel disclosure
of the information sought.
COSTS
o Low. Often considered the cheapest form of DR.
REMEDIES
o Wide range of remedies that can be customised to meet the individual needs of the parties which is different to the limited remedies available in court. If an agreement is signed, it is binding like any other contractual agreement however it lacks the enforceability that court orders have.
GOVERNING BODIES
o NADRAC (Click here for more information)
ADVICE
If negotiation isn't appropriate, proceed to explore the mediation option
