HIGHLIGHTING THE 97% OF LITIGATORS WINNING CASES WITHOUT GOING TO TRIAL
INTRODUCING M. LAURIE MURPHY, Principal, Valensi, Rose, PLC
Jan: Laurie, give me some background about your experience.
Laurie: I’ve been a litigator with the same firm since 1989. my undergraduate degree is in civil engineering in which I also have a masters degree. Before going to law school, I was a civil engineer, but I went to law at night school a couple of years later. I have always maintained an interest in real estate and construction.
Jan: Can you give me an example of a case in which you were able to avoid a trial and still get a great result for your client?
Laurie: Yes. Recently, I represented a partner in a real estate venture where the two parties were disputing over the acquisition, construction and carrying costs of a multi-million dollar home that they were building as their primary residence. They invested in the property together after a long term romantic relationship. Unfortunately, they broke up right after the construction of the home was completed. Even more unfortunate, the original agreement between them did not include a mediation clause and in view of the huge financial stake as well as the highly emotional nature of this dispute, we couldn’t get the matter settled for quite a while.
Jan: What was the strategy you took to get the matter settled?
Laurie: I tried to get the parties to mediate before the lawsuit was filed, but the attorney for my client’s former partner refused. He filed a lawsuit instead and he was not approachable so we really didn’t talk about settlement for the rest of the time that he was representing the Plaintiff. After he was substituted out and a new attorney was brought in, we participated in a Court ordered mediation but unfortunately that failed.
The issues were complicated and although we participated in a full day private mediation before a retired Judge, both sides left disappointed because it felt like the Mediator didn’t want to “get down in the trenches” and really dig into the accounting issues as well as the legal ones. Although the mediation didn’t result in a settlement, we were able to keep the lines of communication going between counsel thereafter. He’s a reasonable guy and I’m also reasonable, so we kept talking and meeting and narrowing the issues. We had several meetings and lots of emails back and forth including getting our accounting experts involved in an effort to narrow the issues and minimize the prolonged pain of the litigation.
Following the mediation hearing, and with the court’s indulgence, we agreed to stay formal discovery and obtained stipulated continuances for both trial and motion dates. As mentioned, we met informally with the parties present as well as our experts to discuss the issues. With an attorneys fees provision, we all knew there were huge financial as well as emotional obstacles to settlement, but both sides wanted “stop the bleeding”. Their personal lives were being impacted by the time and energy as well as financial resources they were committing to resolve this dispute and it was clear that both of them wanted to move on.
Jan: How did you or your client come up with the “Winning” idea that lead to the settlement?
Laurie: There was an apparent and painful logjam between our clients and opposing counsel and I knew that both of our clients wanted help out of it. When opposing counsel and I met with our clients the last time, we came up with an idea to make a “joint counsels' proposal” (akin to a mediator’s proposal) which both of us considered to be a fair compromise. I can't recall ever having done this before, but both of us thought it might work and we felt we understood the issues better by now than the mediator had at the hearing. The issues were complicated and somewhat diverse, but instead of further polarizing the parties, counsel and I came up with a comprehensive list of terms the major one being a method to jointly market the property.
Jan: Why was it so effective?
Laurie: The initial “joint counsel proposal” ultimately lead to a meeting between the clients only. They finally had a good starting point to tweak the terms of the joint proposal until they reached an agreement on all of the various terms. When they circled back to us, we added a proposal that an arbitrator be appointed to resolve future controversies on very short notice if necessary while the parties were marketing the property. This gave both sides the comfort necessary to go forward with the deal despite the uncertainty that is ever present in real estate sales. Though there is still a fair amount of distrust between the parties, because counsel and I worked together to come up with a creative but fair proposal, the parties felt they were protected and could move forward.
Jan: What was the turning point that allowed the case to settle and avoid a trial?
Laurie: this was a case that should never have been filed in the first place but unfortunately one does not get to choose opposing counsel. And again unfortunately a lot of time and money was wasted during the time he was in the picture. But, once prior counsel substituted out and a new, more rational counsel was brought on board, after our first conversation, I knew I could develop a line of communication upon which I could build. It took several meetings and some mutual trust in one another to get to the proposal. Also, the fact that the Court was willing to continue our trial and agree with the stay of discovery really helped us focus on settling instead of posturing the case for trial. In actuality, it was very pragmatic—just unusual. Also, I have to say that our mutual disappointment with the outcome of the mediation lead us to thinking about creative ways that we could step in as counsel to mediate the dispute in some workable way. I really didn’t know if it would be accepted by the clients, but they did agree to our proposal ultimately.
Jan: Was there an “aha” moment that resulted from avoiding trial and settling the case?
Laurie: Listen, my client is a wealthy individual who does not litigate for a living who has plenty of other businesses, hobbies and interests and who was anxious to get on with life.
Jan: Laurie: You are litigating like crazy. What to you do for fun?
Laurie: I'm a horse fanatic. I have two dressage horses. I take lessons on them every weekend and compete from time to time.
