Case Study

The Cost of Death on Chinese Roads

chinese-death-cost

Summary

This negotiation case shares insights on how to handle rural Chinese negotiations in the event of tragic deaths.

by Dr Bob March

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Overview

Mark Rogers is an English expatriate in Beijing, where he is the finance director of the branch of a U.S. multinational. He has been in China for seven years, during most of which he has held a Chinese driving license and driven on Chinese roads. In 2004, he was driving to the famous Shaolin Temple, a few hours south of Beijing. An hour out of Beijing, it started to rain heavily, and on taking a sharp turn in the road in Hebei province, he accidentally drove into two pedestrians, Wu Hua and his sister Wu Jiao. From the nearby village of Suixi, they had been forced to walk on the road because of flooding. Rogers braked, but his car slid and he lost control, side-swiping the Wu siblings and hurling them onto a stone wall by a flooded storm-water drain.

The Scene

Shocked and shaking, Rogers pulled up and rushed to help them out of the drain. He pulled the woman up onto the road and ran after the man, who was floating away slowly, and pulled him onto the road. Cars kept passing, in both directions, but no one stopped to help. Unable to find any sign of life in either of the bodies, he was horrified.

Rogers used his cell phone to telephone his secretary, Betty Xiao, in Beijing, and told her what had happened. She told him to cover the bodies and wait in his car for help to come. Three hours later, a farm truck pulled up, and two farmers got out. They both came up to him carrying cell phones. Repeatedly they nodded to him and one offered him his cell phone, pointing to the mouthpiece and flapping his lips.

Rogers took the phone and heard the familiar and reassuring voice of his secretary: “Oh, Mark, what an awful experience! These two men have come from the nearby village. They will drive the two people to their village for help. You follow them. You can communicate with them through me, using our cell phones.” “Thanks very much, Betty. It’s a bad scene here. I’ve killed both these people,” he said, grief stricken.

Thus, horrendously, did Rogers start his involvement in a civil suit brought against him by a diverse group of plaintiffs from Suixi village, including the deceased’s workplace union, their family members, village officials, and others who were never precisely identified.

Although, technically, Rogers would not have been at fault three months earlier, the law had just changed. Drivers in such situations were liable for all damages, even if pedestrians or other parties were at fault (as was the case here).

A Civil Approach to a Civil Suit

Rogers’ insurance company was the recently opened Beijing office of Carolina Greater Insurance Co. (CGI). They took over the compensation negotiations with the group of parties who were eventually to assemble in Suixi to seek compensation for the death of the Wu siblings.

CGI decided to employ a professional negotiation company that was well established in China, Security International (SI), to represent them in the negotiations with the Suixi village plaintiff group. SI appointed two people to handle negotiations: their Beijing manager Brian Monaghan (a former member of the Royal Canadian Mounted Police and a security specialist) and his Chinese manager Wang Sheng Cu (a former People’s Liberation Army officer).

Six weeks after the deaths, they arranged to meet with the plaintiff group in Suixi. There were fifty people present representing the plaintiffs, but Monaghan and Wang persuaded them to appoint only two to negotiate with SI. The deputy mayor of the village and a lawyer were chosen.

Negotiations Begin

Negotiations were held each morning for seven days until agreement was reached. The two Chinese reported on their progress every evening to a large village meeting, while the SI negotiation team reported to their CGI client every night.

Monaghan spoke Chinese quite well but stayed in the background, while Wang acted as spokesperson. Negotiations moved from one set-piece speech or proposal to the next, followed by long, private conversations on both sides. The Chinese Suixi group presented detailed calculations of the compensation they sought, the largest item being a solatium (jing shen pei san jin).

This was also the item on which most time was spent, the Chinese view being that there was a potentially unlimited amount to be paid when a formal apology could not make up for the spiritual damage caused the plaintiffs.

The SI team, under instruction from CGI, conceded that this type of damage payment was appropriate—according to precedent, with poor rural families in particular. Opposition to this claim would have met resistance and seen the claim multiplied due to the perceived intransigence of the defendants.

SI was able to achieve a compensation payout satisfactory to CGI, totalling only seventy-five percent of the bottom-line target figure they had previously agreed with CGI. The Suixi Chinese group were also happy, the figure being twenty-five percent higher than what they had privately decided to target.
In recognition of the win-win outcome, SI funded a banquet in Suixi for the entire village on the last night.

Commentary

In reflecting on this case, Monaghan said he was modestly proud of what they had achieved, the goodwill generated, and the fact that the payout was within budgetary limits. Most of all, he was thankful to his colleague Wang, who had managed the entire affair masterful negotiation skills. “He was the real negotiator,” Monaghan said. “I was just the figurehead.”

Modesty aside, without someone of Monaghan’s maturity and experience to allow another to step in, the suit easily could have escalated into a drawn out conflict, ultimately costing twice as much or more than the figure for which they settled.

But more importantly, they had avoided taking their suit to a Chinese court. Had that happened, the suit might have taken years to resolve. The final lesson to be drawn from this case is that clever, experienced Chinese are a mandatory element in any negotiations with the Chinese.

This negotiation case is published with permission from Dr Bob March’s excellent book “Chinese Negotiator”.

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