DIGNITY IN THE DEAL
IVAN HOFFMAN, B.A., J.D.
From the origins of humanity, relationships of every sort have been governed by the formula D=W3M. When I say “relationships,” I mean to include not only business dealings but personal relationships as well, although this article will deal with only business relationships. And within the scope of business relationships are all forms of contract negotiations such as author-publisher agreements, web designer-client agreements, various forms of assignments and all other forms of business relationships.
The formula refers to the idea that the Deal (D) is made upon the basis of Who Wants Who (W3) More (M). For a discussion about this formula from a substantive point of view, read “Controlling the Agenda.” This article will deal with other aspects of this formula.
What Is Dignity?
Much like the 1960’s explanation of “pornography” coming from the United States Supreme Court, it is often hard to define but we know it when we see it. Or better still, we know it when we don’t see it.
Dignity is the same concept as self-respect. Without respect for yourself, without your dignity, what can possibly be the value of the deal? What I often see is that parties to any relationship give away substantially all, if indeed not the totality, of their power, their leverage. This often comes because they either do not know their own value or do not believe in what they may intellectually know about their value. For whatever the reason, a deal without dignity quickly turns to dust as the party either:
A no-win situation. And what possible reason can anyone have for making a no-win deal?a. resents not having made the deal; or
b. resents having made the deal.
The best deals are made by those who can afford to say “No.” By “afford,” I do not mean to limit this idea to merely financial independence. Certainly the party who can financially afford to say “No!” is often in a better position to negotiate better terms, although they do not always do so. Instead, independence in this context is more about personal independence, about a sense of self-worth that creates that personal independence. After all, there can be a party to a negotiation who may have significant assets but is not independent by any means. For that party, they lack independence because for them making the deal is important in and of itself. It is the conquest of the other side that motivates them. They must “win” at any cost and usually they end up paying a high price for their win. They actually need the deal more than the party who may have less assets. After all, the more you need something, the more dependent you are on that something.
Those that have true independence are those that can walk away. After all, the less you need something, the less dependent you are on that something. Those that have options and know their options (these are two different points-read “Capitalism”), often are in a position to make a good deal, although they do not always do so. If you approach any deal from a place of need or, in the worst case, desperation, as though you must have this deal or some disaster will befall you, then you will likely make a terrible deal. In that sense, it is the same as the above-mentioned financially “better off” party. Both parties are equally desperate.
Neither party is independent. And neither party comes away from the deal, whether it is made or not, with any dignity.
And without dignity, whatever you gain from the deal may likely be unsatisfactory. It may produce certain “rewards” such as money, and if you are willing to settle for these “rewards,” then perhaps the deal will work for you. But if your dignity matters, if your self-respect is part of who you are, if you make deals only in which you are valuing yourself and if you approach the deal with that focus in mind, you may find that the deals you used to make you are no longer capable of making. Indeed, you are not willing to make.
This is of course not to say that these rewards are not important for clearly they are. The entirety of my law practice is about seeking to maximize those rewards for my clients. But this article, which is not about legal issues per se but about broader ideas, posits that the rewards, coming at the expense of dignity, are not rewards at all. This article is part of the articles called “sui generis.”
An admittedly non-quantifiable term, dignity is thus often overlooked in deal making. At least it is overlooked by the mind. Dignity, or the lack thereof, can never be overlooked by the gnawing, tugging sensation of our personal “operating system,” the operating system that keeps you up at night. As you probably know, an operating system in computer-ese is the internal programming, often operating unnoticed in the background, that allows all other systems to work. A defect in an operating system can block the operation of all other systems. We often interpose a firewall between our operating system and our head to keep our lack of dignity, our lack of self-respect, from infecting what we would prefer to keep in the “background.” Except with some considerable effort, however, the defect rises to the surface and becomes quite evident. We seem to spend much of our time re-booting and looking at blue screens.
Lack of dignity is often overlooked as a possible source for over work, over consumption, over eating, and a variety of other “over” ailments often superimposed by the mind on our operating system to keep our operating system from dealing with the lack of dignity that the deepest parts of us know to be true. As above, dignity is often best recognized by its absence.
Dignity Equates With Responsibility
Dignity in the deal is about taking care of oneself within the context of the deal. Each party to a negotiation has the responsibility to themselves to advance his, her or its position. Inherent in the concept of dignity is the idea of personal responsibility. The only person truly responsible for you, at least when you are adult, is you. (This excludes relationships in which one party has an obligation to take care of the other. This article is about arms-length transactions.) And inherent in the concept of personal responsibility is the further concept of freedom. It seems self-evident that if you need a deal or any relationship, you lack freedom.
Deal making is not about expecting the other party to be “fair” in the negotiations. And in fact the interface between dignity and deal making only arises when each party has exercised their said responsibilities to themselves in the transaction and when each side then comes away from the deal, whether the deal has been made or not, with that sense of self-respect that dignity provides. Paternalism and expecting paternalism benefit no one. If you feel you have been treated paternalistically, there is no dignity. It is only when you feel you have been valued for your value that you can come away with a sense of dignity. (Read “Standard Contracts.”) It is only when each party has advanced its position, irrespective of the outcome, that the highest level of negotiation can have taken place. In other words, the greatest good for the individual comes when the individual feels complete. And if the individual feels complete, then the greatest good for the collective whole, sometimes called “society” is thus advanced. If, on the other hand, the individual has given away his, her or its power, then by definition there is no dignity, no self-respect either for the individual or for the individual to take out into the same “society.” Instead what the party takes out into that “society” is a perpetuation of dignity-depriving behavior including seeking to impose the same on others.
Thus only deals that work for both sides are the deals in which both sides come away with their dignity intact. If one side feels they have lost their dignity, they will seek ways to undermine the deal, get out from the agreement, litigate etc. and thus the deal will not work for the other side either. If a deal does not work for one side, then it does not work for the other side either, even though it may appear to be working on the surface.
Having said the above, even though each side must take care of itself in the negotiations, the parties must each behave in such a manner so that they do not intentionally deprive the other party of their dignity. Driving a hard bargain, making a good deal are not incompatible in any manner with preserving the dignity of the other party. If one side drives a hard bargain, it is up to the other side, in the exercise of its responsibility to itself, to drive an equally hard bargain. Both sides need to tug at the strings of the deal with equal vigor if the highest level of good is to be accomplished. But making a good deal for oneself does not require you to take care of the rights of the other party—that is part of their responsibility to themselves. Expecting the other party to relinquish its responsibility to itself just to help you out, just to be “fair,” is incompatible with:
For a further substantive discussion about this, read “Dignity for Designers.” Although nominally about designers, the points of that article apply to other situations as well.a. capitalism;
c. personal responsibility; and
Every party to a negotiation should have its own “deal breaker” points, points that it will not relinquish. These points vary with the individual parties and the individual deal. The issue here is not what those points might be in a given negotiation. Instead the issue is that often parties appear to have no such “bottom lines,” no such “dignity deal breakers” as it were. Or if they do, they seem more inclined to relinquish those points just to have the deal, the relationship. Parties often believe that if they take legal and negotiating positions that respect themselves and their value, that the other party may not be willing to make the deal. Thus making the deal becomes more important than the dignity.
If the deal is not made because you have advanced your legal and negotiating positions in regard to what you perceive as your value to the deal, as has the other side, then the deal was simply not to be made. That happens. On the other hand, if the deal is made because one side or the other has disrespected themselves enough to give up their dignity by not recognizing and advancing their value to the deal, then the “value” of the deal is reduced to purely money issues which, while important, are beyond the scope of this article.
If money alone were sufficient, those with money would always be happy and those without money always unhappy.
That is not so in my experience.
Keep in mind that nothing in this article has anything to do with the process of negotiating and the art of compromise that comes within that process. Compromise does not entail loss of dignity—unless the matters compromised entail the loss of dignity.
There are no bright lines that can be drawn in this discussion. What is or is not “dignity” for each individual is not capable of precise, written definition.
But if you’ve seen enough “blue screens,” you will understand.
Nothing can hide from a defective operating system.
Copyright © 2003 Ivan Hoffman. All Rights Reserved.
This article is not legal advice and is not intended as legal advice. This article is intended to provide only general, non-specific legal information. This article is not intended to cover all the issues related to the topic discussed. You should not rely on this article in any manner whatsoever and you should not draw any conclusions of any sort from this article. The specific facts that apply to your matter may make the outcome different than would be anticipated by you. This article is based on United States laws but the laws of other countries may be different. You should consult with an attorney familiar with the issues and the laws of your country. This article does not create any attorney client relationship and is not a solicitation.
No portion of this article may be copied, retransmitted, reposted, duplicated or otherwise used without the express written approval of the author.