Why Mediate?
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June 2004 |
FINDING SHADES OF GRAY IN BLACK AND WHITE ISSUES
All dispute resolution, whether by war, litigation, jury, judge, tossing of coins, arbitration or mediation, involves disparate conflicting positions requiring choice or resolution. If we picture the dispute and the parties as a spectrum with black on one end and white on the other, statistically the best resolutions will be in a shade of gray. Game theory suggests the possibility of minimax – maximizing the win while minimizing the loss for both parties. Of the alternate forms of dispute resolution, mediation will achieve the closest to optimum results for all parties simply because the parties, considering what is individually most important, themselves make the decision jointly.
The parties can pick the shade of gray they both like best. The other methods of dispute resolution are likely to be winner-take-all. If a party wants to gamble on winner-take-all, mediation will be the least preferred method of dispute resolution.
TRANSACTIONAL COSTS
Early mediation will save tremendous transactional costs for both parties. Later mediation will still reduce costs. Litigation costs tend to follow a pattern resembling some form of lazy m over time – a peak of activity followed by an extended period of constant low level activity, then another peak of intense activity in conjunction with trial. At the complaint and answer, both sides expend dollars and energy creating the limits of the controversy. Then costs diminish with discovery and preparation, but cumulatively, the more elapsed time for discovery and preparation, the more time and money that will be spent. Before and during trial, all of the forces available come to bear on case preparation and presentation, again spiking the costs. A mediated result will cut off the ongoing build-up and continuation of expenditures on discovery, investigation, research (legal and otherwise), witness preparation and discovery, trials and appeals. Experts may evaluate the case but will not need to be deposed and examined at trial.
Over and over again, cases set for a week or longer of trial are resolved in mediations taking a few hours or a day. Trials cost money and consume resources.
EMOTIONAL COSTS
Even salaried employees disputing a business deal gone bad suffer emotional costs in every lawsuit. Inherently, trials and trial preparation examine every aspect of behavior at a minute level well beyond the limits of normal behavior in the ordinary course of human events. That examination and reexamination, that repeated second guessing, carries with it immeasurable costs in tension and conflict. The sooner the issues can be resolved, the sooner the parties and witnesses can return to their “normal” life, the sooner happiness will again be restored..
FINALITY OF RESULT
Once, the president of the American Bar Association and a group of distinguished jurists had an informal lunchtime conversation that focused on “What is justice?” No one agreed; the only consensus was “finality of result.” The uncertainties of a trial inevitably lead to the uncertainties of an appellate process, a process that adds years to the ultimate outcome and cognizable fortunes to the transaction cost of getting there. A mediated solution is an expeditious and immediate resolution of all outstanding issues bringing certainty and resolution to the dispute. Few winning parties surviving litigation and appeal believe they are better off than they would have been had they taken a lesser settlement early on in the litigation process. If the result involves payment of money, will the payer go bankrupt after losing the litigation? How much will actually be collected if you win the winner-take-all gamble?
A BINDING AGREEMENT
In mediation there is no agreement until the agreeing parties reach the agreement. If the agreement does not contain that which you must have, you do not have to agree. But once you agree to the mediated result, it is a binding agreement. Any party can go to court (and another trial) to have it enforced.
A RESOLUTION DESIGNED BY THE PARTIES
Do you want to design the outcome of your dispute or let some disinterested third-party like a judge, arbitrator, or jury decide it for you? In mediation you contribute to the design, you assure that your special needs have been accommodated.
A RESOLUTION DESIGNED FOR THE PARTIES
The judge, jury, or arbitrator, based upon the facts and the law, will design the solution – perhaps black or white – based on the outcome that they think works. In mediation, you, with the help of your counsel and the mediator, determine which of your needs must be addressed and how they are addressed.
SOME ADVOCATES CANNOT NEGOTIATE
Neutrals love the practice of law and the legal profession. Some lawyers zealously represent their clients as no-holds-barred go-for-the-jugular aggressive assertive take-no-prisoners fight-to-the-death advocates. Their clients love them. Other lawyers zealously represent their clients by mildly preparing for trial going about their business researching, writing, conducting discovery and presenting their cases. Their clients love them. The clients of the first type of lawyer particularly need mediation, the intervention of a neutral third party to assist them in finding a solution. Their counsel will never leave a penny on the table even if it costs a million dollars (of the client’s money). The neutral can help minimize the amount left on the table.
SOME ADVOCATES SHOULD NOT NEGOTIATE
Some clients want their warrior to be unyielding. They need to deal directly with the neutral. The mediator insulates the advocate from the client’s perhaps unreasonable expectations. The attorney wants the client to know that the attorney has done everything possible to get the best deal.
SOME CLIENTS NEED AN INDEPENDENT VIEWPOINT
The black robe effect suggests that the client will listen to a middle-ground evaluation by a person wearing judicial robes while refusing to listen to the same analysis from their lawyer. They need a third party to neutrally tell them they will have to pay this much or that their claim is only worth that much or the probable outcomes are thus and so. Neutrals cannot predict the outcome of anything. Neutrals can discuss case and position strengths, weaknesses and past experience.
REALITY CHECK
The client and attorney, wrapped up in the strength of their case, each believe in themselves and their cause. Use the mediation process to test how a neutral reacts and evaluates the irresistible arguments and the overwhelming evidentiary findings. Everyone may be surprised.
How do the parties present themselves and their case? Does the claimant believe he won the lottery? Are the parties credible? Does the case flow? Do the parties know their case? Mediation, different from discovery/depositions, can be used for some of the same purposes (and you just might find a resolution).
APPLICATION OF DIFFERENT SKILLS TO FINDING SOLUTIONS
The mediator’s bag of tricks contains different tools than those used by the parties and their advocates. The mediator searches for the optimum that satisfies all parties and their counsel, not the single solution that maximizes benefit to one side, that imposes the most harm on the other. The insights of a neutral differ from the insights of an advocate, notwithstanding that their objectives may be the same. The neutral listens and designs, the advocate studies and argues.
DEPTH AND SPEED OF ANALYSIS
The parties and their counsel have grown with the development of their cases. The mediator inevitably makes a quick, fast analysis and than structures a resolution with the parties’ help. Inevitably the parties are committed to their positions and their process. The neutral starts with an essentially completed case. The neutral quickly focuses on that which is important to the parties, helping the parties construct a solution.
THE MEDIATOR HAS NOTHING AT RISK
The neutral’s ability to walk away in the absence of agreement outweighs all other factors as the best contribution to the ability to find solutions. The neutral has no investment in any of the ranges of possible outcomes. The neutral has nothing at risk in the negotiation presentation process. The neutral also has the ability to say: we are not going to reach a solution to this problem. (That statement always has a silent qualifier: today.)
Frequently a party counsel will object to every mediator proposed by the other. A mediator can not be pro plaintiff or pro defendant. A mediator should be pro lets find a solution for both parties, even though one of the parties could be his best friend. The plaintiff wants a lot. The defendant wants to give almost nothing. If the mediator can not bring them together, than they both walk.
BELOW THE LINE AND OUT OF THE BOX THINKING
The neutral will ask the questions:
What do the parties really want?
Can it be translated into dollars and sense?
The problem-solving abilities of the judiciary are limited to dollars awarded from one party to another and orders not to do something (injunctions). The neutral can help the parties find other solutions, use different dimensions, reach agreements, meeting differing needs. Frequently judges, juries and arbitrators find themselves in the position where they can only decide all or nothing, but recognize that the parties themselves can reach a better, arbitrary middle ground. The neutral can cause the parties to consider matters outside of the law and the rules of evidence, matters beyond the pleadings.
HOW DO I KNOW I HAVE NOT LEFT SOMETHING ON THE TABLE?
A successful mediation has the parties pick or create an optimum solution. The mediated result will not be the only possible solution. The mediated resolution may not be the best solution for either party, but most certainly will be the best solution for both parties.
In this article, the word “compromise” has not been used. Yes, the end result involves a lot of give and take. The give and take brings the parties to a solution. The outcome is a resolution.
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