A major Canadian industrialist signed a property deal with a Chinese businessman in the Philippines, with whom he had hitherto enjoyed a long and mutually profitable association. At first everything went on smoothly; then the Chinese began suffering losses in his core business, and began covering them by withdrawing funds from the property investment. After a few months the Canadian decided to take action. Tied up with other work, he sent his legal advisor on a fact finding mission in order to discover what had happened, and to find a basis for negotiating a compromise.

The Chinese had not previously had of this lawyer, and first learned of his presence in the country when he received a phone call from the airport. "I am Mr. X's legal advisor. He has asked me to find a solution to his problems.

The Chinese was proud of his status as an independent and successful entrepreneur. He was used to dealing with only persons of the same status, and was not prepared to negotiate on equal terms with a "servant." He responded by delaying, and finally refusing to meet his partner's emissary. After spending three days kicking his heels in a hotel, the lawyer returned to Toronto.

Questions

1. What cultural aspects apparent in this scenario if known could have made the negotiation successful. (8 Marks)
2. After the lawyer's return to Toronto, the Canadian responded by taking his one-time partner to court in a series of expensive actions. But if you had been consulted after the lawyer's return, using the stages in the negotiation process, what advice would you have given the Canadian in respect to future dealings with the Chinese partner? (12 Marks)