I. THE MEDIATION PROCESS IN A NUTSHELL
Mediation is the use of a third party to assist parties in negotiating a resolution or at least narrowing the matters in dispute. At the beginning of the “mediation era,” one publication succinctly defined mediation as follows:
Mediation is typically initiated either by the parties voluntarily submitting the matter to a public or private dispute resolution organization, or by the court suggesting or ordering the parties to submit to mediation. The mediator is generally process-oriented, arranging meetings between the parties, assisting in the exchange of information, and relaying parties’ interests and positions. In fulfilling this role, the mediator may have private meetings with the parties to facilitate the negotiations, and may even actively participate by proposing settlements. In many cases, the mediator need not have any special expertise in the area of dispute, but in contract cases, it is often helpful if he does.
Crowell, Appealing Government Contract Decisions: Reducing the Loss and Delay of Procurement Litigation, a Report to the Admin. Conference of the U.S. (Oct. 1987).
Today, mediation is widely used, particularly in certain industries such as construction. Nonetheless, it is valuable to go back to the basics. While some attorneys give short shrift to preparing for the mediation process, the better idea is to treat that process seriously and prepare for the mediation almost as one would for a small trial.
Mediation works best for those disputes which do not involve matters of “principle” or the desire of one or both parties to establish some legal precedent. If the facts or the application of the law to the facts is in dispute, then a third party neutral may be able to assist the parties to better appreciate the strengths and weaknesses of their respective cases and to arrive at a compromised economic resolution. While theoretically any third person could act as a mediator, it is recommended that the parties attempt to choose a mediator who, by training and experience, appears to have the ability to facilitate a resolution. The American Arbitration Association and numerous other organizations offer mediators to requesting parties. Some people prefer to have an agreement in writing setting forth the procedure for the mediation. Items that might be covered in any such agreement are:
- The parties to the agreement;
- The method for the selection and payment of the mediator;
- The extent, if any, to which the parties will engage in discovery or other exchange of information prior to the mediation meetings;
- The length and place of mediation sessions;
- The extent to which the parties will submit to the mediator, or to each other, position statements, and the timing of such submissions;
- The rules of conduct for the mediator (e.g., must all sessions be joint sessions, or can the mediator engage in “shuttle diplomacy” by meeting with one party, and then the other?); and,
- Confidentiality of the proceedings in order to prevent the use of exchanged materials and positions in future litigation or arbitration.
Based on experience, it appears that mediation is most effective when the parties believe that the mediator is objective, and where the mediator is willing to express his opinions in a non-adversarial fashion so as to cause the parties to be exposed to the objective view of a knowledgeable third party. Mediation is really a form of reality testing. One matter that should be considered in preparing the mediation agreement is whether in the event of a stalemate the parties will request the mediator to provide his or her opinion as to the likely result in the event of litigation. It is the author’s opinion that a strong-willed, but gentle-mannered mediator will succeed more often than would a mediator who doesn’t “push.”
In order for mediation to be effective, it is necessary for the parties to appoint as their participants in the mediation, individuals who are authorized to engage in settlement negotiations and reach agreements, and who are not so emotionally involved in the dispute as to prevent effective, objective negotiations and, of course, individuals who will take the time to learn the issues and present forcefully the position of the party for whom they are appointed. Sending someone to a mediation without authority to settle or someone who is too wrought-up over the issue is a prescription for a failed mediation.
To achieve a satisfactory resolution, both attorney and client must be thoroughly prepared for the mediation process. The necessary preparation includes an awareness of how the process works and the roles of the various players. Finally, the attorney and client must have an understanding of the facts and a general negotiation plan in order for the resolution goal to be achieved.
Remember that you’re attending the mediation to communicate your position and to listen to and understand your opponent’s position and to thereafter make a good faith effort to resolve the differences. The skilled mediator’s role is to act as a catalyst in bringing about that resolution and it is your task to help him as far as your goals and interests will allow.
II. SELECTING THE MEDIATOR
A good mediator is a good negotiator. Some people believe that good mediators are born and not made, although the point is certainly debatable. The person whom you select should have great people skills, although he need not be at the top of his Dale Carnegie training class.
What you need to look for is the right mediator for you and your problem. That will be an individual who comes to you by way of recommendation or reputation. The individual should be a person who sounds like the kind of individual you would get along with, at the very least. Of course this may be hard to judge since you won’t usually have a lot to go on; but you should question the mediator’s experience and background. Ask the names of others who have used that mediator and follow up by asking those people what they thought of the individual.
As Ross Hart reports in his article, “Improving Your Chance of Success During Construction Mediation,” Arbitration Journal, December, 1992, a good “decision maker/negotiator” to represent a party should have the following qualities:
- Empathy, or the ability to understand the other party’s point of view, if only in order to counter more effectively.
- Patience, or the ability to wait for sometimes very gradual movement which occurs in resolving differences between parties.
- Self-assurance, or the quality of not only knowing what you are doing in terms of facts and liability, but also knowing that you have the support of the party whom you represent in the negotiations.
- Ingenuity, or the ability to originate arguments or proposals to overcome differences as they arise; and
Interestingly, those laudable assets for negotiators representing parties are precisely the kind of traits needed by good mediators. That is no surprise at all since a good negotiator will likely me a good mediator and vice versa.
There is much discussion of whether a good mediator needs to be specifically trained in the subject of the dispute. Without question, someone specifically trained in that area will more likely be able to quickly grasp issues, understand customs and usages in the trade and more readily have a “feel” for how things work in that particular industry. However, it has also been said that a good mediator can mediate any kind of dispute. Indeed, it is common even for someone specifically skilled in a particular subject matter to successfully mediate matters totally unrelated to that subject matter. Again, asking around about particular mediators would answer those types of questions.
Finally, while it is important to know that a prospective mediator’s success ratio is high, it is necessary to know how extensive the experience is before that success ratio has any meaning. Not all cases settle, no matter who mediates them. Anyone with a 100% success ratio should be carefully examined before usage — the lawyer who has never lost a case hasn’t tried many. If statistics found on the internet are accurate, common success ratios range in the 75% – 95% range for the best mediators in the business. Presumably, if someone is consistently having ratios substantially below that amount, then they shouldn’t remain in the mediation business long anyway.
III. HOW TO PREPARE FOR AND PARTICIPATE IN MEDIATION
Just as in good negotiation, preparation for mediation requires special effort. The chance for success in the mediation, just as in any negotiation session, bears some great proportion to the seriousness with which the parties approach the process. Here are some suggestions on how to prepare for a mediation session:
A. Before the Mediation Session
- Have an understanding of the mediation process – get a copy of any applicable hearing rules (e.g. American Arbitration Association Construction Industry Mediation Rules), read them and understand how they work; don’t forget that mediation is a negotiation process.
- Have enough facts developed so that the mediation will be meaningful. This does not mean that full discovery has been conducted, but either informal or some formal discovery probably should have been conducted.
- Identify the client’s true needs and be sure the client understands those true needs.
- Identify and focus on the client’s ultimate objectives – in litigation or settlement.
- Identify the client’s parameters of compromise.
- Evaluate benefits, risks, and costs (direct and indirect for each) of the alternatives to settling by way of the mediation.
- Be sure that your team is skilled in negotiation basics so that they understand what is going on and assume appropriate roles.
- Have an understanding of your negotiation team’s hierarchy and how members of your team are to relate to the other side’s team members and each other.
- Determine (as best as possible) the opponent’s positions:
- is it a life or death matter, or simply a run-of-the mill dispute;
- what are the personalities, interests and goals of the other side’s representatives;
- what was the last discussed settlement proposal; and,
- what external pressures exist.
- Analyze external pressures – yours and the opponent’s time pressures – for the mediation hearing day and in the big picture; what will happen if there if no settlement; and c) use your knowledge of your opponent’s external pressures which you have identified.
- Identify your best facts and outline the story to be told, using those facts as leading items.
- Line up succinct evidence, whether by way of witnesses or documents and have that evidence ready to go as needed – use experts, if necessary, for fully explaining and clarifying issues.
- Is your position such that it can be reasonably justified? If so, you must establish your credibility and create trust in you (a powerful negotiating tool) to sell that position. Likewise, develop cogent reasons why the other side’s positions are unreasonable.
- Define the issues in a light most favorable to you for presentation to the mediator.
- If you have identified a particularly strong issue, goal or feeling held by the opponent, consider how to work around it and how you intend to enlist the mediator’s help to work around it.
- Identify your approach, prioritize your issues and have an understanding of how you want to use that priority in your discussions (public and private) with the mediator. Be prepared to rethink those priorities if the mediator evidences (or states) a disagreement with your priority ordering.
- Outline your opening statement: it’s the opportunity for the most structured aspect of a mediation – after that, the mediation is largely ad hoc.
- Arrange to have your client’s decisionmaker on site and review these preparation steps with that decisionmaker prior to the hearing. Some will advise that having the decisionmaker available by phone is acceptable, but if that is to be the case, be aware that it’s second best and, at the very least, there must be a terrific communicator present on site who can convey the feelings, movements and flavor of the proceedings to that decisionmaker by telephone.
- Consider alternatives ahead of time.
- Have a negotiation plan – as simple or complex as the case requires (easy/hard, give/take, good guy/bad guy, fast/slow). Determine how proactive (the only trendy term contained in this paper) you want to be in the caucus sessions – do you want to give the mediator a bottom line (real or unreal) or do you want to offer trades (e.g., if they do X, we will do Y). This negotiation plan may alter as the “feel” or “flow” of the mediation session dictates.
- Prepare a position paper for the mediator and/or opponent, if required or desired.
- Be prepared and have your client prepared to accept reality.
B. At the Mediation
- Be rested and eat a large breakfast since good mediation sessions usually require some stamina. Matters are often resolved after long work days.
- Size up the mediator and the opponent’s negotiating team to determine how those parties square with your plan of dealing with them–identify or confirm who is the decision maker on the other side–if you can’t confirm this you may ask the mediator to help you–he may.
- Remember that the mediator is not a decision maker.
- Make an effective presentation to the mediator (both publicly and privately) in order to:
- use the mediator to give your client an unbiased view of the situation; and,
- use the mediator to test untried approaches to and ideas for resolution; and,
- formulate, receive, consider, and discuss alternatives to settlement with your client and the neutral.
- Let your client get the satisfaction of telling the whole story or hearing you tell it.
- Tell the story in the most understandable fashion possible, using demonstrative evidence as necessary. Persuade the mediator, as well as the other side of the reasonableness of your positions – remember that the creation of doubt in the competition’s respective and collective minds is one of your major goals.
- Use evidence at the conference:
- to convey and convince;
- to intimidate;
- to elucidate;
- to create doubt about the opponent’s case; and,
- to impress about your and your client’s resolve.
- Encourage and support mediator proposals, if you can without unduly compromising your goals and needs.
- Identify unresolved issues and state your views on them in the joint session so that time is saved and a framework for discussion is established.
- Identify resolved issues and known facts so that encouragement is given to your opponent and the mediator of your willingness to recognize positive movement.
- Be prepared to rethink issues and priorities when matters are presented in a different light.
- Don’t get emotional – leave the venom at the door.
- Don’t dig in your heals on any issues unless there is no alternative, a matter determined only after full consideration of alternatives.
- Be creative and open-minded when it comes to possible solutions – don’t just think in terms of money.
- Keep all of your team members informed of what is happening.
- Take notes of what is going on so that you can review and consider matters in private with your team members.
- Leave no point unresolved if that point can later explode the settlement.
- Once agreement is reached, put it in writing immediately, even if it’s 2:00 a.m. and it’s in longhand.
The successful mediation will follow those guidelines. If all parties are sincere in their efforts to listen, think and work, then the issue has the greatest chance of settling. The well trained mediator will be the catalyst and teacher in the listening, thinking and working.