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Settlement Authority

by Phyllis Pollack
November 2011

PGP Mediation Blog by Phyllis G. Pollack

Phyllis  Pollack

Routinely, most local rules of court require that persons with the ultimate authority to settle a matter be physically present at a court settlement conference or mediation. While it does not take much thought to understand the rationale behind this requirement, it may take a bit more thought to appreciate the consequences of not honoring it. I mediated the consequences of not abiding by this requirement the other day.

It was an employment dispute. Present at the mediation were; (1) the attorney for the defendant; (2) the attorney for plaintiff; and (3) the plaintiff. Both counsel were young associate attorneys, practicing law for less than three years. Both had partners at their respective law firms to whom they answered and who were monitoring the negotiations during the mediation. Further, no representative of the corporate defendant was personally present; I was told the representative was available by telephone.

After discussing the facts and issues of the case for a little while, the plaintiff’s attorney conveyed his initial demand to me. However, it was approximately more than twice as much as his previous demand to defense counsel. (For example, if plaintiff’s previous demand was $20, his new demand was $50). When I tried to warn him that this strategy would not go over well, he resisted, insisting I convey it.

I did, and it was not at all well received. Defense counsel refused to make a counteroffer. So, I held a joint session with both counsel in an attempt to discuss “real” amounts. Slowly, it came to light that plaintiff’s counsel was negotiating as he was instructed to do so by the partner back in the office and was only able to accept a certain amount if it was within a certain range. However, the defense attorney believed that range to be unrealistically high and had already rejected what his client believed to be an excessive demand. Nevertheless, defense counsel had been instructed to keep within that range (even though previously rejected.)

When I attempted to discuss damages in terms of hypotheticals (e.g. if defense counsel is able to obtain authority to offer $30, will plaintiff accept it?), I quickly found that this tactic was fruitless. Since the amounts were not within the range given to plaintiff’s attorney by his boss, he could make no commitment. Instead, he wanted defense counsel to make a firm offer that he could then discuss with his boss by telephone. However, defense counsel did not “want to go out on a limb” to obtain this increased authority, if it was not going to be ultimately accepted by plaintiff. Each was waiting for the other to make a firm commitment that they could then take back to their supervising partners for approval.

At this point, I felt like either Vladmir or Estragon waiting for Godot (Waiting for Godot by Samuel Beckett), since each attorney was waiting on the other to make the first move and neither could do so because of the instructions they were given by their respective supervising partners.

Needless to say, the matter did not settle. The sad part is that both counsel wanted to settle the matter and clearly recognized that the matter should be settled rather than tried. But their negotiations were not their own: they were mere puppets.

It was a frustrating experience not only for the attorneys and plaintiff but for me as well. There was nothing I could do to help them settle the case as the parties with the authority to settle simply were not there! I was mediating with empty chairs. There was nothing in my toolbox that could help me other than to tell them to go home and keep negotiating via their supervising partners.

So – this is why the courts require those persons with the ultimate settlement authority to be physically present at a mediation. Without them, the mediation is fruitless: we are simply waiting for Godot.

. . .Just something to think about.


Phyllis Pollack with PGP Mediation uses a facilitative, interest-based approach. Her preferred mediation style is facilitative in the belief that the best and most durable resolutions are those achieved by the parties themselves. The parties generally know the business issues and priorities, personalities and obstacles to a successful resolution as well as their own needs better than any mediator or arbitrator. She does not impose her views or make decisions for the parties. Rather, Phyllis assists the parties in creating options that meet the needs and desires of both sides.  When appropriate, visual aids are used in preparing discussions and illustrating possible solutions. On the other hand, she is not averse to being proactive and offering a generous dose of reality, particularly when the process may have stalled due to unrealistic expectations of attorney or client, a failure to focus on needs rather than demands, or when one or more parties need to be reminded of the potential consequences of their failure to reach an agreement.

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