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As part of running a business, you may experience a commercial dispute with another party. It is, therefore, important that you know how you can resolve the dispute in a timely manner whilst maintaining a positive relationship with the other party. One way to do this is to engage in business negotiations for your commercial dispute so that both parties can find common ground and reach a mutual outcome. This article will explain some useful tips for you to reach negotiation success in your commercial dispute.
What is Commercial Negotiation?
Negotiation, also known as a negotiated settlement, is an alternative dispute resolution (ADR) method. This means that it aims to resolve the commercial dispute without resorting to litigation in court. Other forms of ADR include mediation and arbitration, for example.
Negotiation for your commercial dispute is an informal and flexible process where you and the other party will communicate directly with each other to resolve the dispute. You may also use a third party who is independent and impartial to the dispute to help facilitate a resolution. You may also do this through your legal representative, such as a dispute solicitor. Negotiation for your commercial dispute is a confidential process, non-binding and voluntary.
This guide outlines how to resolve commercial disputes.
What Top Tips Are There for a Successful Negotiation?
If you go through or are in a commercial dispute and choose negotiation as a resolution method, you should be aware of how you can prepare and conduct yourself. Below, we explain three top tips to help you maximise the benefits of negotiation.
1. Prepare Effectively
It is crucial for you to be properly prepared before you begin a negotiation. One way to do this is by ensuring that the dispute lawyer/s you work with clearly understands the context of your issue. This can include matters such as the background of you and the other party’s business relationship and why the dispute arose. In doing so, you ensure that you receive effective legal advice about the strengths and weaknesses of your side of the dispute. Furthermore, effective preparation with legal expertise can provide you with clear direction moving forward. It will also help your lawyer/s see if there are any opportunities for an early agreement that will avoid prolonging your dispute.
2. Be Ready to Compromise
Importantly, you should remember that the primary goal in negotiation is reaching an agreement both parties are satisfied with. As a result, you should be prepared to compromise during the negotiation. This, however, does not mean that you ignore your interests. In order to achieve a balanced and satisfactory outcome, you should consider your:
- ideal outcomes in the settlement agreement;
- worst-case scenario
- other accepted results; and
- values aside from financial matters, such as your commercial relationship with the other party or opportunities for future contracts.
One of the benefits of choosing negotiation to resolve your commercial dispute is that it helps to maintain good working relations between you and the other party.
3. Document as You Go
A crucial tip for successful negotiation in your commercial dispute is to document what you discuss and agree on throughout the negotiation process. This can ensure that the final settlement agreement is accurate and mutually agreeable. Furthermore, if your dispute escalates to the courts, clear documentation strengthens proof of what you and the other party had decided on. This can help you to enforce the outcomes in the agreement.
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Key Takeaways
Negotiation is an alternative dispute resolution (ADR) method to resolve a commercial dispute. This means it takes place out of court, is more flexible and voluntary, as well as non-binding. Negotiation also includes direct discussion, which can be with a neutral third party. Ideally, commercial negotiation will end in a settlement agreement. To ensure the success of your negotiation, you should:
- engage in extensive preparation with your lawyer/s;
- keep an open mind and be willing to compromise; and
- maintain continuous documentation about the negotiation process.
If you need help unpacking effective negotiation for your commercial dispute, LegalVision’s experienced disputes and litigation lawyers can assist 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 0808 196 8584 or visit our membership page.
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