Skip to content
Home » Relying on Decision Analysis to Resolve Legal Disputes

Relying on Decision Analysis to Resolve Legal Disputes

The importance of a structured analysis

Experts in litigation, arbitration and mediation are all on the same track. Both the ICC and the American Bar Association have released several articles and books advocating the use of a structured analysis to help disputing parties understand the potential value and risk exposure of a legal dispute – and based on this strive for a negotiated solution that can balance the two.

Decision analysis – Frameworks for Better Decisions

The frameworks recommended by experts and thought leaders all have one thing in common. They are based around defining the components of the dispute (strength of evidence, applicable rules, legal costs, time, external costs etc.) and then relying on these to produce a quantitative analysis. Tools for this include building decision tree models, and other types of models for evaluating a case. A quantitative analysis means relying on numbers (probabilities) instead of just words in a memo, when describing the potential outcomes of a dispute.

Eperoto supplies the tools, material and support needed to analyze both complex international arbitration and local court disputes by relying on these proposed methods.

Input required: Say what you mean and mean what you say

An article with title How Likely is Likely, published on artificial lawyer.
Article published by Artificial Lawyer, discussing the challenges with using words of estimative probability.

Some lawyers find relying on quantitative analysis daunting. Understanding if a case will be fully successful, partially successful, or a complete failure is most times very difficult. Naturally, many lawyers therefore shy away from expressing their opinion using numbers. But if not even the experts can express their opinion about the strengths of the case, then who can?

Without any information at all, it is of course impossible to express an opinion around the probability of success. But even after an initial assessment, an expert must be able to start expressing their current opinion on the strengths and weaknesses of a case. Commercial clients and stakeholders are mature enough to understand that an initial assessment is something that can change.

Eperoto provides the not only the software, but also the know-how and advise around how to best model different types of cases.

Best Estimates Provide the Best Decisions

In the end any decision to proceed with litigation or arbitration or to settle a case will be based on the parties perceived understanding of their chances of success or failure, and what this would mean financially. Still, this expression is often something found at the end of a memo, relying on vague terminology (such as “will likely be successful”), and many times not defining what a success would mean financially. 

Mediators and experienced counsel are very good at getting an overview of even complex disputes, and identifying weaknesses and risks. Many times, an outcome is not as easy as just win/lose. In very few cases can a party with a strong case completely disregard the risk of a loss. By also relying on a quantitative, probability-based approach, an experienced counsel or mediator can work together with stakeholders and parties to help them understand the overall value of a case – and from this propose a range for where a settlement would provide more value or less risk than proceeding in arbitration or litigation. 

Eperoto’s Solution: Clear and Concise Assessments

By relying on decision analysis, a counsel or mediator can sometimes establish ZOPA, a zone of potential agreement, in where it would make sense for both parties to settle a case. Eperoto provides the tools needed for just these types of assessments.

An image demonstrating the Zone of Potential Agreement
By relying on decision analysis, it becomes easier to identify settlement resolutions that is beneficial for both parties in a dispute.

If you’re curious about how you can use decision analysis in settlement negotiations and mediation, don’t hesitate to get in touch or book a demo! Follow Eperoto on LinkedIn if you’d like to receive more information on this topic.