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Should I Be Worried About Multi-Party Negotiations? Part 1

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Multi-party negotiations occur when three or more individuals representing different parties meet to resolve differences pertaining to their interests, needs, and objectives. Ideally, a multi-party negotiation will result in a consensus, but it’s ultimately up to the relationship between these parties and the nature of the negotiation. There are many types of multi-party negotiations, and the definition of a “party” is largely contingent on the particulars of the dispute. In the construction industry, a multi-party negotiation could be used to help settle differences that arise through a partnership involving multiple owners or contractors. It could also be useful in settling disputes between more than two subcontractors.

In this two-part series, a South FL contractor lawyer from Cotney Construction Law will cover everything contractors should know about multi-party negotiations and help you answer the titular question — should I be worried about multi-party negotiations?

The Pre-Negotiation Stage

Every multi-party negotiation starts with a pre-negotiation. Typically, the pre-negotiation stage involves informal contact between negotiating parties, who will be responsible for making a number of decisions, including:

  • Identifying participants and coalitions
  • Defining the roles of each group member (task, relationship, self-oriented, etc.)
  • Stating the consequences of an unresolved negotiation
  • Learning the main issues and develop a suitable agenda

What Defines a Multi-Party Negotiation?

The difference between a two-party negotiation and a multi-party can be as simple as the addition of one party, but this simple distinction can result in substantial logistical challenges. As a result, multi-party negotiations are significantly more complex than other types of negotiations involving only two parties. Multi-party negotiations are defined by a number of factors, including:

  • Number of Parties: as its name suggests, multi-party negotiations involve more than two negotiators.
  • Informational and Computational Complexity: introducing additional parties to a negotiation creates complexities involving the number of issues and perspectives in play at the negotiation table. The volume of information needing to be assessed and negotiated is significantly greater.
  • Social Complexity: multi-party negotiations operate as as small-group discussion, not a one-on-one discourse. This creates additional dynamics between the various negotiators and requires multiple parties to reach a consensus despite differing viewpoints with no clear “middle ground.” Some negotiations can be compromised by the development of group dynamics that pit multiple parties against another.
  • Procedural Complexity: the corresponding processes for conducting a multi-party negotiation is decidedly more complex than those used in two-party negotiations.
  • Logistical Complexity: the logistical complexity of multi-party negotiations can be much greater than two-party negotiations. For instance, negotiations involving multiple parties from different states can create distrust between parties. One party may opt out of negotiations for fear of a lack of transparency.
  • Strategic Complexity: in multi-party negotiations, all parties must be treated as equals. This is easier said than done. Every negotiator will want their thoughts and opinions balanced against the others, and sometimes it will require separate one-on-one negotiations to make headway in a multi-party negotiation. If a consensus is not reached within a reasonable timeframe, negotiations may be rendered ineffective.

To learn more about multi-party negotiations, including the key challenges and ways a South FL contractor lawyer can improve your chances of reaching a mutually agreeable resolution, read part two.

If you would like to speak with one of our South FL contractor lawyers, please contact us today.

Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.