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An Apology Made All the Difference.

January 26, 2015

The legal issues were not complicated in this commercial landlord/tenant dispute.

Nevertheless the mediation was a challenge, mostly due to the longstanding, overlapping business, professional and personal relationships of the two sides.

On the corporate tenant’s side, the company’s focus on business decision making was the order of the day. The company made and received monetary proposals dispassionately and analytically.

On the individual landlord’s side, by contrast, strong personal emotions, and a cross cultural perspective, permeated the discussion and sometimes distracted the lessor from the exchange of offers and counteroffers.

At one point, in a private caucus, I heard all about the emotional, personal and financial stake of the lessor who had put her heart and soul into her investment in the building at issue. The building meant everything to her.

In the other room, to help explain the challenges I was facing, I told the room full of lawyers from the national corporate tenant about this emotional component.

Among other things, I explained that the lessor is extremely frustrated by the tenant’s multi-year lack of attention to the open issues concerning the building, and that the tenant is thus insulted and hurt given the multi-faceted relationships of the parties.

Spontaneously and sincerely, the corporate General Counsel in the room apologized and said that this was not the way that the company should have been conducting business.

I asked him if he would be willing to say this directly to the lessor. He said he could, although it turned out not to be necessary.

Along with a compromise financial offer, I took this heartfelt apology to the lessor’s room and communicated it with as much meaning as I could muster and added that the General Counsel hoped the apology would be accepted.

It was.

The lessor explained to me that she would now accept the compromise proposal being made because: (1) she recognized the voluntariness and sincerity of counsel’s apology; (2) she recognized that the apology of the attorney was in fact the apology of the company; and (3) she recognized that both sides respected and wanted to protect the longstanding relationship of the parties.

There are some who think that business disputes are just about business.

I don’t agree. There’s always more to it than that.

***

David I. Karp is a full time independent mediator of real estate and business disputes in Southern California. His website is at http://karpmediation.com .

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