No one likes to get sued.  It’s expensive.  It’s time consuming and nobody really wins, except maybe the lawyers.  

Apologizing may sound like a totally a counter-intuitive move.  However, some academic medical centers have discovered they can substantially cut their litigation costs by acknowledging preventable errors and apologizing for their mistakes instead of making excuses and denying them.    

It’s been reported that at the University of Illinois only one patient out of 37 sued after receiving an apology and at the University of Michigan Health System claims and lawsuits declined from 262 to 83 between 2001 and 2007, resulting in a 2/3 drop in legal costs.  Now that’s a cost savings you can take to the bank, including the drop in malpractice premiums.  

The issue of disclosure through apology is not an academic one confined to university hospitals.  Groups like the American Medical Association, the American Hospital Association, and the Joint Commission which accredits hospitals have adopted standards encouraging transparency and disclosure and many hospitals have written policies in compliance.   

Maybe these smarty pants doctors may be on to something.  They are recognizing that nothing morphs a reasonable patient into an indignant one — one who is ready to pull the pin out of the lawsuit hand grenade – than denial and concealment of an error.  Denial provokes fear that it can happen again and the concealment is nothing more than disrespect of the other party.     

Let’s face it.  No one likes being lied to, especially if they are paying the price for your mistake.  It makes them angry.  It provokes outrage.  It’s the kind of negative energy that sends them running to lawyers’ offices.     

You don’t need to be in the medical profession to benefit from the hospitals’ experiences.  The next time a contract dispute arises with a customer or vendor, ask yourself whether a mistake was made.  Be honest with yourself.  The same goes for an employment dispute, or any other business/ legal problem.     

In the end, a sincere and well timed apology can turn negative energy into positive energy.  It’s a lot cheaper than a lawyer and you can get on with your business.  

Bad experiences often lead to bad legal language.  Every strange warning label you’ve ever seen on a product is the result of a lawsuit.  Even “warnings” that sound like common sense, such as “do not iron while wearing shirt” are the result of folks seeking common “cents.”  (By the way, if you’re interested in more of these you might find the Wacky Warning Label site run by the Michigan Lawsuit Abuse Watch of interest).

Contract often evolves the same way.  A recent article in the NY Times discusses how builders dealing with prima donna homeowners add contract clauses to avoid repeating prior bad experiences. 

Take for example the contractor who leaned a material delivery up against a fence.  The added pressure made the gate to pop open and the family dog wandered off causing the homeowner to launch into an abusive tirade.  The dog came back in the middle of the argument, but, to avoid becoming a verbal punching bag the next time there is now a clause that says workers “shall not be expected to keep gates and the like closed for animals and children.”

Another contractor got burned when a client withheld $10,000 due to a missing kitchen cabinet door knob.  Now their contracts reads “final payment is due upon substantial completion.”

On the flip side, as a homeowner, if you’ve ever had to call a contractor umpteen to get them to finish a project, the “substantial completion” language may be a problem.  It therefore pays to read contracts and to seek clarification about mutual expectations — even the ones that seem obvious to you. 

It’s cheaper than a lawsuit and will save a lot of frustration.