Key Concepts for Litigation

Key Concepts for Litigation

While sitting in a complex mediation recently, key words on which attorneys and clients alike should focus began to surface.  Those words are SUCCESS; CREATIVITY; FLEXIBILITY; PATIENCE; AND COST/BENEFIT.  Examining the words in the litigation context may help you prepare for your next case.

SUCCESS – In modern society, “success” is viewed almost exclusively in terms of a win or a loss.  That narrow view may cause problems in litigation because rarely is the litigation process so black and white.  The plaintiff may be virtually guaranteed a win if the term “win” means obtaining a judgment for every penny claimed including interest and attorney’s fees.  The result is an enforceable piece of paper which may be utterly uncollectable.  Is that a success?  What is that judgment worth to the plaintiff’s bottom line?  The reality is that most businesses would view recovery of some amount to be a greater success than attainment of that piece of paper. It is possible for “success” to end in a win-win.  Keep that odd concept in mind and keep reading.

CREATIVITY can lead to the win-win.  If the plaintiff/creditor is focused on maximizing recovery, then it will be open to creative resolutions.  Solutions may involve security, payments over time, and/or creative sources of revenue.  The key is paying attention to the opposing parties’ reality/circumstances. A creative settlement might produce a financial recovery and even preserve a business relationship.

FLEXIBILITY – You truly cannot get blood from a turnip.  If a party is rigid in what is required to resolve a case, opportunities to maximize recovery may be missed.  “We have to recover 100% of principal” may negate an offer to settle for 80% early in a case.  There is a good bet the party will spend more than the 20% difference on litigation costs before the case ends.  There is no guarantee a judge will award attorney’s fees and no promise the other party will not empty its coffers defending the action.  Neither compromise nor a cost-benefit analysis should be viewed as weakness.  Flexibility may well be prudent.

PATIENCE – Litigation is a marathon, not a sprint.  One saying among lawyers is “mediations rarely get serious until 4:00.”  Because of the Rules of Civil Procedure, litigation takes time to unfold.  While discovery is a pain, it often results in information which serves to clarify issues.  Mediation can do the same.  Listening, paying careful attention to not just what is being said but to the context of what is being said, and keeping an open mind can result in a positive result – if you exercise patience.

COST/BENEFIT – This aspect of litigation constantly evolves throughout a case.  It ties to the first four concepts.  As information develops, your analysis should evolve.  Your spending related to litigation costs increase. Your understanding of the financial status of the opposing party also increases as well as your knowledge of the other party’s position and its relative strengths and weaknesses.  This may lead to a decision to cut losses by becoming more creative and flexible, and result in success in the form of recovering as much as possible given the totality of the circumstances.

Or, you may decide this case is a matter of principle such that success will only result from a trial with an outcome determined by a judge or a jury.  That is always an option.  As attorneys, we want clients to make informed decisions throughout a case. Considering whether a case is a matter of “principal” (actual recovery) or “principle” (standing up for what you believe even if there is no actual recovery in the end) is ultimately the client’s decision.

 

– Nan E. Hannah