PERSONS: Client (“C”) and Advocate (“A”)
SETTING: Warsaw, the Client’s office
SUBJECT OF CONVERSATION: financial terms of mandate in pre-trial negotiations with a large aviation company
A (to President of the Board:) We have been working with you since 2006, we are now entering a decisive round of negotiations and I would like us to prepare for this task together. First of all, we have to put our financial affairs in order, and unfortunately, for six months your company has not paid our invoices and the overdue amount is very large. We cannot go on like this.
K (to Advocate): I like and appreciate you and your law firm. I want to work with you on this matter very much, but I cannot pay your invoices because I do not have the money now. And secondly, I consider this form of remuneration to be outdated in form and inadequate in our relations. We must find some other solution.
A: What solution? My Board does not accept mandates that are so unclear and has instructed me to give up the power of attorney. We must first solve the debt problem.
K: You are blackmailing me. You know that I cannot win this case without you. I have been working with you for six years now and, I must admit, we are doing great, you are effective and your action plan gives me a chance for success. I am very satisfied and I trust you.
A: In that case, what do you propose in order to find a way out of this impasse?
K: You know what? Maybe we could sign a business contract stating that we are conducting these negotiations together, I am responsible for the commercial side and you are responsible for the legal side. Your fee will consist of an initial lump-sum portion, and the main portion will be a success fee, calculated as a percentage of the compensation received by my company – of course only if we win these negotiations and reach a settlement. How about that? My idea comes down to a business partnership between the client and the advocate, and joint responsibility for the outcome. If we win, we all win. If we lose, I don’t get the compensation, and you don’t get your success fee. I think that’s fair. I want you to be the lead negotiator, I will help you. I believe in your experience and your skills. Together we will win this battle.
A: Thank you for this proposal. I like it very much, it has to be approved by my management, and we have to put it down in black and white.
K: That is what I mean! I am waiting for your answer.
The Client paid the outstanding sum.
The Firm accepted the proposal and the parties signed the agreement.
The negotiations were successful, the Client received compensation and the Firm was paid for its work and success.