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Buyers Remorse In Settlement And Mediations: Seven Ways To Avoid It

Recently, I read a blog post regarding attorneys coercing their clients to settle a case. On Victoria Pynchon’s blog, Settle It Now.  This made me think about the issue of buyers remorse that can happen in mediation and how to avoid the issue.

This is an important issue there are known cases of clients suing attorneys (or the other side) after having settled the case. For example, Joe Francis of Girls Gone Wild sued to rescind the settlement.

As a litigator and as a mediator I have heard comments that have made me feel that the client had buyer’s remorse in some way or other.  Sometimes, a client will ask, “did I do the right thing?” or “did I get a good deal?”  Other times, they will outright say, “I shouldn’t have done the deal.”

The reality is that buyer’s remorse happens in some level in many aspects of life.  Purchase of personal items, electronics, home sales, and the list goes on.  I recently bought a camera and had buyer’s remorse the moment I was using the product.  Did I pay too much?  Should I have bought a lesser camera that cost less?

First, why does it occur?  According to research, people are poor at predicting the true state of their emotions.  Second, buyers’ remorse attaches to people’s self confidence about the decision.  Often times, mediation and litigation is a foreign environment and the clients fear that they may have made the wrong decision because of lack of knowledge.  Buyer’s remorse can also be caused or increased by worrying that other people may later question the settlement and claim to know better alternatives.  Another common cause of buyer’s remorse comes from talking to family members and friends, who may mean well, but aren’t happy with the settlement.  Often these people will say things like I could have gotten better, or John got double that amount for his case.

It is important to understand that buyer’s remorse is an emotional response to a serious decision.

Steps to Take To Help Eliminate Buyer’s Remorse.

First, in these difficult situations, everyone has a lack of confidence.  Now add on whatever insecurities the person generally feels.  That is the recipe for Buyer’s Remorse.  However, buyer’s remorse can be considered a symptom of the need for confirmation – confirmation that the person made a good decision.  In mediation, invariably you will see people who need confirmation that the decision they made is a good one.  In fact, I have had people directly ask me, “have I made a good decision?”

Once that person receives some conformation from others, the buyers remorse disappears.  As such, after the deal has been put to paper, you can help boost the client’s confidence by giving them confirmation that the deal is a good one. You can’t control what other people will say about the deal, but you can control what you say.

Here are some suggestions to help give your client confidence.

First, build trust and rapport with the client from early on in your relationship.  This way when it comes time to making the decision, you already have their confidence.

Second, do not start confirming the sale until the deal is finalized. If you confirm too quickly, the client will only consider that as pressure from you to make the deal.

Third, personalize your confirmation to you.  Don’t just say, “you got a good deal.”    (Although that is not a bad start) Say “I know that you got a good deal.”  Personalizing the comment to you identifies your confidence into the deal.

Fourth, confirm the benefits of the deal.  “Now you don’t have to have your deposition taken.”  “You don’t have to worry about the trial during the holidays.”  Reinforce the decision with the benefits of the settlement that makes it a good decision.

Fifth, congratulate the person on a deal.  Have you ever gone to an auction?  After the buyer has bid up an extraordinary price for the piece of art, the seller congratulates the bidder and everyone applauses.  This is simply a tool to help avoid buyer’s remorse.  Do the same thing after the settlement.  Call the person a few days later, and congratulate them again.  Your call can often eliminate buyer’s remorse before it gets a foothold in the client’s mind.

Sixth, ask the client for a favor such as asking them to pop by when they are in the neighborhood.  By doing so, you have also implicitly stated that you are confident in the decision and that you are not afraid of meeting them after deal is done.

Finally, let the client know that she is not the only person to have feelings of buyer’s remorse.  Simply letting her know that she is not alone will help her feeling of remorse.  She will know that this feeling is normal.  Explain that her feelings are so common that there is a name for that moment: It’s called Buyer’s Remorse.

Buyer’s Remorse is a common feeling in mediations.  The more you prepare your client for the feeling, the better you will have a chance to avoid the legal implications of having a client unhappy with a settlement.


Steve Mehta

Steven G. Mehta is an attorney and mediator providing unique mediation services in a variety of types of civil litigation. His ability to understand the human process and complex emotional issues involved in legal negotiations enables him to effectively assist the parties in obtaining the best possible results during mediation.… MORE >

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