Information on Your Mediation
Mediation is a process where the parties to a lawsuit or arbitration, with their legal counsel, work through an independent mediator who helps attempt to facilitate a voluntary settlement between the parties.
The mediator does not act as a judge or an arbitrator, and cannot decide the case for the parties. The mediator’s work is done through diplomacy and assisting the parties to better understand the strengths and weaknesses of their respective positions in the legal proceeding.
Often, but not always, the mediators are lawyers who have undertaken to focus their practice in serving as settlement mediators. Sometimes they are former judges. Whatever their background, their objective in a mediation is to help guide parties in a dispute to a settlement that both sides will accept.
Generally a mediation commences with an initial meeting between all parties, counsel and the mediator in one conference room. In this opening session the attorneys for both sides typically make an opening statement presenting their client’s case. This does not involve testimony from the parties or other witnesses. However, parties may express additional comments after the opening presentations by their counsel. But, be careful in doing so. It is usually best for client to not make comments in the initial mediation session with the opposing party present unless the remarks have been discussed in advance with counsel.
A minority of mediators dispense with opening presentations altogether under the theory that opening statements are too adversarial and counterproductive. Such mediators prefer to communicate whatever relevant information that needs to be communicated through the mediator.
Typically, after the initial presentations, the mediator will separate the two sides into different conference rooms. The balance of the meditation is spent with the mediator shuttling from room to room to try to negotiate a settlement. In this part of the process, you can feel more comfortable about sharing your comments, observations, and feelings with the mediator. Obviously, the mediator is only going to use those comments if he or she believes they would be helpful in persuading the other side to make movement in their settlement position toward our position.
The mediation continues until either both sides agree to a settlement, or until one or both sides determine that no progress is being made and there is no benefit to continued mediation. If the mediation concludes in settlement, the settlement sums are generally paid within two to four weeks after mediation. If no settlement is reached, the litigation or arbitration continues as if the mediation never occurred.
Even if no settlement is reached, the mediation process still provides a significant benefit. Often, in an effort to persuade you to settle, the opposing party and their counsel will reveal information about their position in the case or their theory of the case that they intend to present at trial or hearing, that you otherwise would not learn of until the date of the trial or arbitration hearing. Therefore, even where settlement is not achieved, the mediation process can have significant benefits.
What Is the Cost of Mediation?
Mediators typically charge an hourly rate for their participation in a mediation as well as their preparation for the mediation. Their rates often range from $200 to $350, or more, an hour. A mediator will also charge for any travel involved to the mediation location. Typically, unless otherwise agreed, the parties split the cost of the mediator. Some mediators require an advance retainer payment toward their mediation charges. If not, we will receive a bill at the conclusion of the mediation that you will have to pay whether a settlement was reached or not.
Sometimes, as part of closing a deal in settlement at a mediation, it is possible to request and negotiate that the other side pay the entire mediators’ fee as part of the settlement. That is not always the case, so you should presume, however, that you will be paying for one-half of the mediator’s expense.
Preparing for Mediation
In preparing for the mediation, it is important to first fully consider, evaluate, and acknowledge the strengths and weaknesses of your case. It may be helpful for you to make a list of the strengths and weaknesses of your case as you perceive it, and then discuss them with your counsel in advance of the mediation. All cases have weaknesses and other potential obstacles to success. If there were no weaknesses to your case, there likely would have been an immediate resolution between the parties without need for the retention of lawyers or the initiation of a legal proceeding. Therefore, realistic expectations are critical to a successful mediation.
Review of Documents. It is helpful for the mediation process if you carefully review the pleadings submitted by both sides (the complaint and the answer) so that you are familiar with the case from each side’s perspective. Try to objectively evaluate the case from the perspective of the opposing lawyer. This may help you distance yourself from your subjective feelings concerning your position in the case which may skew your objectivity.
Time Commitment Involved.
In preparing for the mediation, you should make arrangements for time off work so that you are not distracted during the process. If at all possible, you should leave your cell phone at home, and plan to fully concentrate on the mediation process during the time of the mediation. A mediation may last all day and into the evening.
You should prepare yourself for often extended periods of inactivity during the mediation because of the separate caucuses with the mediator. However, it is generally a good indication when the mediator is away with the other side in separate caucuses. It generally means the mediator is focusing on bringing their position closer to ours.
Decision Makers Need To Be Present.
Where appropriate, a party should discuss the case with others who are affected by the outcome of the dispute, whether that be a spouse, family members, or business associates involved in the claim. You do not want to be in a position of refusing to resolve a matter through settlement because you are not sure how others might react to a proposed resolution. In that regard, it is important to bring all decision makers to the mediation. If a spouse or business partner’s consent is necessary for settlement, that person should be present at the mediation.
Mental Preparation Important.
You should prepare yourself as if the mediation or settlement conference is your “day in court.” This may be the time for you to participate and tell your story to the mediator during the separate caucuses. Catharsis is often as important to resolution as is money, if not more so. This means you should prepare yourself in all ways, and in order to be able to communicate your feelings and viewpoint fully. Dress as if this were the trial. Know the facts of the case as if it were the trial. Prepare mentally for the case to be completed at the end of the mediation.
Positive Outlook and Commitment Necessary.
Finally, you should come to the mediation with a positive outlook and a commitment to remain as long as it takes. There is always a time in every mediation when things do not look like a resolution can ever happen. Do not just “throw up your hands” and quit too soon. It is often just after this point in the mediation when things start moving towards settlement. Come to the mediation with an optimistic attitude, and often such an approach will be rewarded.
While settlement mediations, and their success rates, differ from one forum to the next, as well as from one mediator to the next, in general, where both parties have agreed to participate in mediation, settlement is reached more often than not. Many surveys of mediation results reflect success rates of 80% or better. Accordingly, the mediation process presents a golden opportunity to achieve a satisfactory result to your legal dispute if both sides come prepared to compromise and otherwise act in good faith.
Mediation Is Settlement by Compromise
Next, it is important to recognize that mediation involves settlement, and settlement involves compromise. It is not realistic to go into a settlement mediation with the expectation of recovering everything you feel you are entitled to receive. That is not the purpose of mediation. In virtually all cases, both sides genuinely disagree about the facts as well as the merits of the legal claims. The purpose of a mediated settlement is for both sides to compromise their positions in order to avoid the uncertainties, additional expenses, and aggravation associated with continued litigation or arbitration. The worst approach to mediation is to participate with the expectation that the other side will ultimately concede entirely to your position, or to go into the process without a flexible willingness to listen to possible compromise solutions.
Settlement Range Objectives OK, But No Bottom Line Positions
In preparing for your mediation, it can sometimes be helpful for you to determine an optimal settlement range you would like to achieve in the mediation. However, it is counterproductive to fix a specific “bottom line” settlement position in your mind. As is typical in most mediations, you will learn information that you did not previously consider. (In fact, this is one of the benefits of mediation.) Flexibility at the mediation is important. Remember, you control whether you settle or do not settle, so there is no need for a pre-established bottom line position. Having a pre-established bottom line only sets you up for a feeling of failure if, because of information learned or considered at the mediation, you determine that a lower settlement is more realistic and desirable.
Purpose and Role of the Mediator
It is also helpful to understand the purpose of the mediator. The mediator is there to help the parties reach an agreement. The mediator is there to “uncomplicate” things. The mediator is not there as a judge. The mediator does not favor one side over the other, and is not there to determine right or wrong. Although in the separate caucuses with the mediator he or she may share observations about the case that would lead you to believe the mediator has negative views regarding your position, the mediator is not partisan. Please understand that the mediator is doing the same thing with the other side in the separate caucuses. If a mediator did not focus on the weaknesses of each side’s respective position, he or she would never be successful in helping the parties reach a negotiated settlement. The worst mediation experience is a mediator who simply listens to and seems to agree with everything you tell him. That mediator will do the same on the other side, and neither party will make progress to settlement.
The mediator is a neutral who will present the other side’s arguments to you, sometimes forcibly. You must prepare yourself by remembering that the mediator is doing his or her job and is not attacking you or impugning your integrity. You need to be preparing to depersonalize the comments and observations of the mediator and remind yourself before, and during, the mediation to maintain a positive frame of mind.
Generally, mediators are caring professionals who want to help the parties avoid the often unsatisfying process of litigation/arbitration, and who sincerely believe in the desirability of alternative dispute resolution and the benefits of settlement to all parties involved in the dispute. It is a difficult job.
Understanding Your Counsel’s Role
It is important to understand the different role your counsel plays in a mediation from that undertaken at the trial or the arbitration hearing. First, in the mediation opening statements, your counsel’s opening statement should be designed to impress the other side with the strength of your case without insulting or impugning the other party. In other words, the approach in mediation is to be conciliatory while persuading the other side of the strengths of your case. If your attorney trashes the character of the opposing party, it is unlikely that they are going to want to pay money to you. So a good lawyer will attempt to use charm and diplomacy toward the other side in mediation.
Second, during the separate caucuses with you and the mediator, your counsel’s role is different than it will be at the trial or arbitration hearing. In the trial or arbitration hearing, your counsel’s primary role is to advocate your position. However, during the separate caucuses with the mediator, your attorney’s role is instead to provide you with candid advice and realistic counsel regarding your settlement position and the facts of the case as further developed in the mediation.
The Process Is Confidential and Not Harmful to Your Legal Proceeding
Another important factor to understand is that the mediation process is entirely confidential. In Arizona, there are at least three different sources for that confidentiality. They include Rule 16.1(e) Arizona Rules of Civil Procedure, A.R.S. § 12-2238, and Rule 408 of the Federal and State Rules of Evidence. In general, these rules provide that evidence of offers to compromise and statements made in connection with those offers are not admissible in evidence. Therefore you need to understand that you are not weakening your litigation position by participating fully in the mediation and settlement process. Compromises or offers of compromise made in the mediation process cannot be used against you and will not come back to haunt you if the case proceeds to trial. It would be unethical and inappropriate for a lawyer at trial or arbitration hearing to refer to settlement positions of the other side that were communicated during a settlement mediation process.
Legally Relevant Information
In realistically evaluating the facts of the case, and the strengths and weaknesses of your position, it is important to understand that the law seeks to view the facts in an objective sense and seeks to determine what is “relevant” from a legal point of view. Facts that strike a party as important, compelling and persuasive may be legally irrelevant. Furthermore, things that a client knows about the opposing party and demonstrate why the opposing party is a “no good” person may not be admissible at all. Therefore, it is important to be as objective as possible, and to carefully listen to the advice given by the mediator, as well as your own counsel.
An example of the effect of legal relevance is what are typically contained in standard jury instructions. As an example, jurors are instructed not to be influenced by “sympathy or prejudice,” not to “speculate or guess,” and to decide the case “only on the evidence produced in court.” Therefore, what a client sincerely believes about the opposing party may or may not be admissible or useful in litigation or arbitration.
Legal Remedies Limited
A party must also be prepared to understand what the law can or cannot give them. Legal remedies are generally limited to money in civil cases. The law will not impose a duty on a party to apologize, and generally will not restrict his or her ability to continue in their profession. A party may believe that other remedies should be fairly imposed and not understand that the court or arbitration panel cannot give them such a remedy. If your objective is to punish the other side, that is not an objective that is reasonably going to be achieved in the process.
What Happens If No Settlement?
It is, of course, important to consider in the mediation process the alternatives to a negotiated settlement mediation. Please keep in mind that once the opportunity for settlement has passed, the opportunity to be able to decide how the matter will resolve will pass from your control into the hands of strangers, a judge, jury, or arbitration panel.
Also, it is important that you understand how long it might take to realize compensation, absent settlement, even if you ultimately prevail in the legal proceeding. Depending upon where the litigation or arbitration process occurs, literally months and years can be saved by settlement. Even if you win at the trial or arbitration hearing, post judgment motions, petitions, and appeals, can extend the process significantly, and make your successful award or judgment meaningless. Of course, the worst result is a verdict or award that goes up on appeal and is reversed and must be retried.
Further, the failure to settle can create risks that a judgment or award may not be collectible because of bankruptcy or other insolvency issues, as well as the problems associated with going through the collection process and dealing with the potential of hidden assets.