1. Keys To A Successful Mediation Kenneth O. Simon

2. Keys To A Successful Mediation Mediations are funny things. Sometimes the parties scratch, claw, fight, attack, and hammer each other, and move at glacial speed. Other times they quietly proceed, dance a minuet, and reach agreement at warp speed. The funny thing is that mediation works in both situations. There are many reasons why mediations are successful in particular cases and unsuccessful in others. This article explores:  some of the keys to successful mediations;  obstacles to expect along the way; and  methods of overcoming these obstacles.

3. Things That Make Mediations Work Mediations work because the parties want them to work. Let me repeat: Mediations work because the parties want them to work. Here are some of the things that are important to the success of a mediation:

4. 1. A Positive State of Mind The parties should enter the mediation process with the idea that the case can be settled. If their attitudes are negative and expectations low, the mediation does not have much of a chance to succeed.

5. 2. Good Faith “Good faith” is an amorphous term that means different things to different people. What it essentially means is that the parties enter into the mediation process seriously, with adequate resources to resolve the case, and negotiate in a reasonable manner.

6. 3. Adequate Authority We all know that a mediation cannot work if persons with adequate authority to settle the case are not physically present at the mediation. Frequently, claims representatives appear at a mediation with authority to settle the case within a pre-set limit. Sometimes there is no claims representative or client present. In such cases those present at the mediation must either negotiate within the pre- determined limits or communicate by telephone with those with higher authority. This is an unsatisfactory situation. Persons who are not present at mediations can be very difficult to persuade. The “feel” and flow of the mediation are missing and they tend to remain fixed in their positions. It can be difficult for those present at the mediation to communicate the intangible, especially when the person at the other end of the phone only wants to know, “What’s changed since the mediation began?”. Consequently, mediations under such conditions have a lower chance for success than mediations with all the necessary players present.

7. 3. Adequate Authority (Cont’d) Defendants are regularly frustrated when the plaintiff fails to appear with sufficient authority. This situation can arise when multiple plaintiffs are involved but only one or two appear at the mediation. Plaintiffs then have exactly the same problem as defendants: persons present can settle only within pre- determined limits. Judges can address these problems by ordering the parties to appear with adequate settlement authority. It is important to decide exactly what it means to have “adequate authority” to settle a case. Most defendants interpret it to mean authority to settle within the defendant’s evaluation of the case. Most plaintiffs interpret it to mean authority to settle within the plaintiff’s last settlement demand. Although neither of these interpretations is satisfactory, frequently cases are settled in an amount beyond the claims representative’s authority upon the representative and counsel’s recommendations to someone with higher authority.

8. 4. Flexibility As anyone who has ever participated in a mediation knows, the negotiating environment can change quickly. New facts are brought to your attention, a different “spin” or emphasis is placed on known facts, or new legal arguments are raised. Any of these developments can change your perspective during a mediation. For that reason it is important to be flexible and to adjust your negotiating strategy accordingly. Parties who are inflexible can, oddly enough, be successful but only a lower percentage of the time. Parties who are most often successful are skilled at adjusting and “expecting the unexpected.”

9. 5. Patience It is difficult to mediate when one or both sides is impatient. If they believe the situation is hopeless and want to walk out after one or two proposals are exchanged, they are selling the process short. Parties should recognize that a mediation is still a negotiation and neither side should be expected to collapse. Experience shows that even if the parties are far apart at the outset, that is not usually the end of the story. The story continues when the parties are patient and negotiate step-by-step. When the process is complete, the parties may discover to their surprise that they had evaluated the case in or near the same settlement range. If impatience prevails, however, they never get to make this discovery

10. 6. Realistic Expectations Mediations get off to a rocky start when the parties have unrealistic evaluations of the case. If a party insists on a settlement value outside the range of similar verdicts and under similar legal conditions, such a party may be in for a rude awakening during the mediation. Both the mediator and the adversary will attempt to persuade the party that their evaluation is out of line. The lawyer’s task is to manage the client’s expectations concerning the value of their case. Some ineffective lawyers, however, unrealistically inflate their client’s expectations and work the client into a frenzy. Obviously, it is impossible to settle a case under these conditions.

11. 7. Preparation On some occasions the expectations are unrealistic because the attorney has misevaluated the case. The misevaluation can occur for many reasons, such as a weak grasp of the facts or unpreparedness. Successful parties are usually well prepared parties. They know their case inside out and can present their positions effectively.

12. 8. Willingness to Listen and Heed Even well prepared parties need to be able to listen to other views, including the mediator’s and other parties’ views. The worst mistake one can make is to put on blinders and not see the warning signs ahead. The mediation process is designed to provide the information one needs to negotiate on an informed basis. One must heed what one has heard and put the ego aside.

13. 9. Adopt an Effective Negotiating Strate gy There are many ways to mediate a case. An important step in the process is to adopt an effective negotiating strategy. This requires an assessment of the likelihood of success at trial, a consideration of the forum and trial judge, the general litigation environment, the presence or absence of insurance coverage disputes, an awareness of the limits of insurance coverage, and many other factors. Such an analysis should result in a better understanding of the “big picture” and a detailed definition of the client’s goals and objectives.

14. 10. Utilize Effective Negotiating Tactics Effective negotiating tactics are necessary to implement the strategy. Such tactics can include the following:  encouraging the other side to move by making bold moves without showing weakness;  putting on the brakes and signaling the other side that no further big moves will be made until there is some reciprocity;  “tit for tat” moves, in which one party moves in virtually the same amount as the other party (careful, this can also work against you);  being resolute and taking a hard line (without being abusive);  “pointing to a number” by signaling a probable settlement range or number; and  diffusing anger and emotion with expressions of remorse and apologies.

15. 11. Avoid Ineffective Negotiating Tactics It is equally important to avoid ineffective negotiating tactics such as the following:  threatening or insulting the other side;  overplaying one’s hand by turning a position of strength into abusive conduct;  unreasonably high opening demands;  unreasonably low opening offers;  refusing to respond to a proposal and demanding that the other side bid against themselves; and  making the other lawyer “look bad” in front of the client.

16. Things That Make Mediations Fail As you would expect, mediations fail when the conditions which make them work are absent. These conditions include:  A Negative State of Mind  Bad Faith  Inadequate Authority  Inflexibility  Unrealistic Expectations  Unpreparedness  Unwillingness to Listen or Heed  Absence of an Effective Negotiating Strategy  Ineffective Negotiating Tactics

17. Things the Mediator Can Do to Break the Impasse A temporary impasse is to be expected during the mediation. There are as many ways to overcome an impasse as there are obstacles. The mediator can take a variety of steps to recapture lost momentum. Among these are the following:  Creativity. Use creative, unconventional “out-of-the-box” thinking to solve problems.  Narrow the Negotiating Range. Try to close large gaps by encouraging the parties to negotiate within a specific settlement range.  Encourage Bold Steps. Try to create momentum by encouraging the parties to move in large increments.

18. Things the Mediator Can Do to Break the Impasse  Encourage “Baby Steps” if Necessary. On some occasions, big steps are not a possibility. To avoid the loss of momentum, encourage “baby steps.”  Be Brutally Honest. The mediator is being paid to provide a “reality check.” Brutal honesty may be required to bring a party back to the real world. However, there are times when it is counter-productive to push too hard. The mediator must recognize when the parties are under stress and give them the space that they need to function.  Listen to the Parties. Try to really hear what their position is and respond empathetically.  Suggest a Specific Settlement Amount. It may be desirable, if all else fails, to suggest a possible settlement number. This can be a relief to parties who cannot close the gap themselves.

19. Things the Mediator Can Do to Break the Impasse  Schedule Another Session. The parties sometimes need a chance to get more information, catch their breath, or regain their sense of balance. Rescheduling is a good option in these circumstances. The mediation should conclude with a game plan for further discussions.  Emphasize the Advantages of Settlement. The parties sometime need to focus on the primary objective, i.e., to resolve the litigation. By emphasizing the inherent uncertainty of litigation, and the advantages of a prompt resolution, the parties can regain their focus on the objective.  Get Derailed Mediations Back on Track. Some mediations get off track before they even begin. For example, miscommunication can occur between the attorneys regarding the amount of an outstanding settlement demand or concerning who should make the next move. The mediator must spend whatever time is necessary to get the parties to the starting gate.

20. Conclusion Mediations work because the parties want them to work. When the parties approach a mediation with adequate preparation and the right frame of mind, they dramatically increase the mediation’s chance for success.