Negotiation and Customary Law

This post sets out the relationship between negotiation -- where the substance of a deal or resolution is up to the parties to seek agreement on -- and customary law -- where the substance of the deal or resolution is mandated by reference to the practices of others. It would seem that these forms of dispute resolution are at odds, and have little relationship with each other. However, the two are not in tension, and have a clear logical link.

The wider problem of social co-operation is solved be negotiation. To gain the benefits of the division of labour, we must coordinate specialised and scaled production and exchanges with others. These activities are coordinated by negotiation of all manner of transactions. Each transaction may be effected by binding legal contracts, or by less formal understandings and arrangements. Disputes can arise from the dishonouring of contracts (or non-contractual arrangements), or from conflicting activities that result in losses. The link between negotiation and customary law is the limited scope of any particular negotiation. Because of the costs of negotiation, some terms of the contract are speficially agreed on, while others are agreed implicitly. Although modern contract law has a list of conditions that must be met before a term can be implied into a contract, when it comes to the wider underpinnings of the contractual relationship (or non-contractual social relationship), we can be more liberal in admitting acceptance of the terms of membership of a civilised community as forming part of all dealings. On this basis, the law of the society is implied into every social interaction, and, to the extent that this law accepted by the parties, a good basis for its moral authority is also provided.

Turning to the actual process of resolving disputes, the use of negotiation always remains a possibility. The parties can always settle the dispute by negotiation and agreement. Since a dispute is by definition a disagreement, it can always be resolved by agreement. This applies even in the absence of any legal institutions that can provide an authoritative or final decision binding on the parties to the dispute.

One option for all disputants is not to agree on the substantial matter under dispute, but to agree on a procedure to settle the dispute. Typically this procedure will involve a third party who can assist the parties to negotiate more reasonably, or ultimately render a decision binding on the parties. Again it should not be assumed that negotiation and third party determination are at odds. Typically, any third party will only make a decision for the parties if the negotiations have been unproductive and are believed will take too long or cost too much to justify further efforts.

It is only a short step between negotiation and customary law. The custom of dispute resolution is to negotiate, and in the absence of an agreed solution after some effort at negotiation, the next thing any third party facilitator will do is to suggest what accommodations the parties could make to resolve the dispute. Such suggestions are suggestions not primarily about what would be a fair or just resolution to the case, instead they are suggestions about what concessions or accommodations reasonable disputants would accept in the dispute. Customary law boils down to not much more than this:

1. For procedural law: what procedures would a reasonable disputant accept in resolving disputes such as this? and
2. For substantial law: what accomodiations, positions and concessions would a reasonable disputant hold or offer in resolving disputes such as this?
   

From this stand point, customary law means law princially by negotiation. In the vast majority of cases, one would expect negotiation would be the full solution to all social issues including disputes, it is only as a back up that the customs of others are imposed, and these customs are the customs of negotiating disputants.