I.   Introductory Provisions

Negotiation is the process and deliberation, discussion or conference upon the terms of a proposed agreement, or bargain, or sale or business transaction without the use of an independent third party (arbitration).

The word Negotiation comes from the Latin word negotiatio meaning “the act of banking or business”.

There are seven core elements that must be present for any valid Negotiation being Intention, Direction, Terms, Consent, Interest, Proposition and Options:

(i) Intention is that the parties come together in Good Faith, with Good Character (i.e. clean hands) and with Good Conscience (i.e. without prejudice). Without Fiduciary, any agreement through negotiation may be fraudulent and invalid; and

(ii) Direction is that the parties or their agents communicate directly with one another and not through an independent Arbitrator in any form of Arbitration; and

(iii) Terms is that there exists some specific, general or customary terms by which the parties proceed; and

(iv) Consent is that the parties consent to the Terms of negotiation explicitly or implicitly; and

(v) Interest is that the interest of each party as to what they are negotiating for is clear; and

(vi) Proposition is that at least one proposition is made by one or more parties to the others; and

(vii) Options is that following the presentation of at least one Proposition, one or more modified or new propositions as Options are offered until a final Option is considered.

Where the Terms of Negotiation are formalized, the general elements considered are Parties, Warranties, Instruments, Process and Deadlines:

(i) Parties is the formal identification of Parties and their duly appointed Agents to a negotiation; and

(ii) Warranties are any formal promises made by the Parties of a negotiation to one another to strengthen good will and trust and minimize risk of miscommunication, injury, delay or liability by error or omission; and

(iii) Instruments is the formal identification of all legal instruments and documents associated with the negotiation; and

(iv) Process is the formal steps and procedures by which the Parties agree to negotiate, particularly in relation to the review and modification of the Instruments; and

(v) Deadlines are the key deadlines of any negotiation that all parties agree are the “cut off” periods for certain actions, or cessation of negotiation.