Monday, December 28, 2015

The Psychology of Settlement

 
 
For some, litigation has become a less popular option for people who find themselves in a legal dispute. Depending on the issue, litigation can be a costly process, both financially and emotionally, and there is no assurance that either disputant will receive a satisfactory end result through the court system. To address these concerns, and many others, more attorneys are suggesting alternative forms of dispute resolution to their clients.

There are those who won’t feel satisfied unless and until they have their day in court; however, attorneys have an obligation to inform clients of all dispute resolution options so that they can make fully informed decisions on what is best for their situation and desired outcome. Disputants willing to engage in Alternative Dispute Resolution (ADR) will need to undergo a complete paradigm shift in the way they perceive the legal system. Mediation and arbitration are two types of ADR; however, the law is applied quite differently for both. Attorneys should work with their clients to guide them through the process, providing recommendations along the way.

In order to offer the best legal advice to a client, it is helpful for an attorney to understand where the client’s mindset is from a psychological standpoint. This will enable the attorney to determine how open the client will be to negotiation and settlement.

When some people are in conflict, they enter into a “fog-like” experience. The “fog” clouds their thinking, muddles their direction, and increases their anxiety. Heightened anxiety has its own effects on a person’s ability to reasonably negotiate and reach an agreement. It also diminishes the brain’s ability to fire the appropriate level of neurons up to the rational part of the brain, known as the cerebral cortex. When people become anxious, the limbic part of the brain, which processes responses and emotions when humans are threatened by immediate danger, causes them to become more reactive.

When disputants under stress react from the limbic part of the brain, they tend to resort to fight, flight, or freeze behaviors. Their ability to think rationally is diminished. Furthermore, the ambiguity of the situation, (whether they could do better if their issue was brought before a judge or jury) also intensifies the anxiety disputants are experiencing. The fact that neither the disputants nor their attorneys can be certain of how things may turn out creates an anxiety level that has the potential to develop into anger.

ADR, particularly mediation, helps mitigate emotions, such as anxiety and anger, because it offers disputants control over coming up with their own resolution rather than having one decided for them. Litigation, on the other hand, often drives or exacerbates these emotions because the outcome of the issue is in the hands of a third party – the jury or the judge.

So, how can attorneys help clients avoid succumbing to the emotional and irrational part of their brains and enable them to be more productive and reasonable during settlement negotiations?

First, it is essential that attorneys are upfront from the start about the pros and cons of litigation and ADR. When clients are knowledgeable about how to proactively work in an ADR settlement context, they gain a sense of self control and direction.

Second, attorneys should also reinforce that settlement can be the “win” the client seeks. Mediation settlements are created by the terms as agreed to by the disputing parties instead of a “stranger” ordering the client how to deal with an issue.

Third, inform the client that ADR is a voluntary process. This provides the client with some level of autonomy and control. In the settlement context, the clients are more willing to accept all suggested outcomes as possibilities and reasonable options become clearer. As a result, anxiety levels begin to abate. When anxiety levels are reduced, the brain becomes empowered to operate more easily with rational, rather than emotional, thinking.

Once disputants are working from a higher form of thinking, they are more skilled and efficient at identifying goals and questions, generating options, and brainstorming solutions. They ultimately become more emotionally intelligent and better listeners who are motivated, not by anger or a need to win, but by a need to create outcomes both sides can live with going forward.
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Norma C. Izzo is vice-chair of the firm's Alternative Dispute Resolution department. She focuses her practice in the areas of family law and domestic relations, including collaborative divorce, mediation, arbitration, parent coordination, custody, and child support. Ms. Izzo serves on the State Bar of Arizona Committee for Family Law Rules of Practice and Procedure and on the Board of Directors for the Maricopa County Bar Association.

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