Recently, I participated in a mediation – as an attorney for a Plaintiff – in a breach of contract dispute where the contract itself, unfortunately, did not have an attorney’s fees provision. My client was absolutely set on recovering the balance owed him by the Defendant. However, my client refused to take into account how much in attorney’s fees it would take to prepare and try the case and so the case did not settle. It was a poor decision in my view. (Remember, without an attorney’s fees provision, or statute requiring the losing side to pay the other’s attorney’s fees, each side customarily bears their own attorney’s fees in legal disputes.)
As a result of my client’s decision, he lost the benefit of the Defendant’s offer which was to pay approximately 50% of the debt owed in exchange for a dismissal of the case. I encouraged my client to accept the offer because, after taking into account the future attorney’s fees, the Defendant’s offer represented a better net result then taking the case to trial, winning the entire amount owed, and then trying to collect that amount from the Defendant.
My client’s logic was “he – the Defendant – has to pay his lawyer too and he won’t want to do that” was understandable but ultimately non-persuasive because whatever the Defendant did with regard to the Defendant’s attorney had no bearing on what my client could or would recover. (In point of fact, the Defendant may well use what little money he likely has at this point to pay his attorney as opposed to paying back my client.)
Admittedly, it remains to be seen how the case may unfold and, ultimately, my client may be proven to be right if the Defendant buckles and offers to pay more, or all, of the debt owed. However, the chances of that happening are not as good in my view as the case more likely unfolding in the way I described. The mediator in the case was excellent but, as the saying goes, “you can lead a horse to water but you can’t make him drink.”
The point of this blog post? A bird in hand is worth two in the bush. Keep that in mind when you participate in mediation or when you negotiate for a resolution of any kind of dispute.
