Effective use of mediation: overcoming assumptions to make good decisions

December 2015 | PROFESSIONAL INSIGHT | LITIGATION & DISPUTE RESOLUTION

Financier Worldwide Magazine

Good information is required to make good decisions. That’s as true in law as it is in banking. And it’s true when determining whether and how to mediate one’s case. Unfortunately, many attorneys continue to have misconceptions about mediation and mediators. It is common to believe that parties are always less motivated to settle if mediation is court-mandated, that it’s always a sign of weakness to suggest mediation to opposing counsel, that mediation should only occur after discovery is completed, or that former judges always make the best mediators. While these assumptions are all sometimes true, attorneys who rely solely on them when approaching mediation may be working against their clients’ best interests.

There are tendencies to paint mediation in black and white, or to generalise from one’s personal experience with the process. The reality is that mediation comes in a variety of shapes and colours, and understanding the needs of one’s client and the case is essential to using it appropriately.

Motivation isn’t governed by a mandatory-voluntary dichotomy. The other party’s motivation or lack thereof should not be taken for granted. While it might make sense that parties are less likely to be motivated to settle if they are being ordered to mediate, research has not borne this out. Settlement in the end appears to be dependent upon the individual parties and their counsel, and not on whether parties are required to mediate. This may be because parties believe the judge wants them to settle, that the motivation is there in the first place, that the order to mediate can reduce or eliminate the lawyer’s fear of looking weak if they suggest mediation, or some combination of these. The same can be true for private mediation. There are times when parties are contractually obligated to mediate, or when an attorney wants to provide a reality check to a client who has unreasonable expectations for the case.

An offer to mediate is not necessarily a sign of weakness. It would be a mistake to assume that the opposing case is weak (or the attorney believes it is) because counsel for the other side has asked to mediate. Attorneys have many reasons to believe mediation will help one’s case. Aside from the obvious possibility that mediation may assist in difficult negotiations, it also can help attorneys to understand the other side’s case, allows them to gauge the motivations of the opposing party, and may help them to communicate with their own clients. The attorney may also understand that his or her client needs to be heard by the other party.

Mediation should be timed to the needs of the case. There is little evidence that settlement is related to status of discovery at the time of mediation. However, research has found that settlement may be more likely if mediation takes place sooner after the case is filed rather than later, and that late mediation could be detrimental to attempts to settle. Earlier mediation also has the benefit of reducing costs and time to resolution. In the end, the decision about when to mediate should be made on a case-by-case basis, with attention not only to the need for adequate information to effectively negotiate, but also to the readiness of the client to do so. The one possible exception is to wait until after a motion to dismiss or for summary judgment has been decided. Here, initial research indicates that mediation is less likely to settle when such a motion is pending.

Who is the best mediator? It is common for attorneys to assume former judges make the best mediators. The belief is that judges have an aura of authority that can induce settlement, and that they are best placed to evaluate the strengths and weaknesses of each side’s case and the most likely outcome at trial. The truth is that the best mediator is the one who best fits the needs of the case and client. Skilled, experienced mediators employ a wide range of strategies and tactics to assist parties in reaching agreement. The best mediators talk with their attorneys before the first session in order to understand the best way to approach the mediation and work with individual parties.

Attorneys should not expect the mediator to rely on his or her ‘aura of authority’ to alter the parties’ positions. Sometimes lawyers can leverage the gravitas of a mediator who is a retired judge to convince their clients to settle. But there are many ways that a mediator can help parties move toward resolution. For example, a mediator may establish a rapport with the parties and help them save face when making concessions. Or a mediator may help the attorneys explore their clients’ underlying motivations and discover what is keeping them from reaching agreement.

So, what does this mean about decision-making? Good information leads to good practice. Parties and their attorneys need accurate information in order to make good decisions about how to approach their case and prepare for mediation. Treating all cases the same way can lead to adverse decisions for their case. For example, if a party or their attorneys believe the other party isn’t motivated because the case has been ordered to mediation, they may see mediation as a hurdle to get past rather than an opportunity to explore the case and possible resolution. Therefore, they may not fully prepare for mediation and not be ready to engage with the other side, giving the other side an advantage in negotiations. Or the parties may select a mediator who is not right for the case, leading them to become further entrenched in their positions.

There’s a lot of good information on mediation out there. Accessing it will help attorneys to have a more nuanced understanding of mediation and how to make the best use of it for each case.

Jennifer E. Shack is the Director of Research at Resolution Systems Institute. She can be contacted by email: jshack@aboutrsi.org.

Jennifer E. Shack

Resolution Systems Institute