Mediation, An Effective Settlement Strategy By Arnold W. Schwartz Introduction In the arena of litigation, controversy is endless but resolution should be the ultimate goal. Perhaps one of the most effective methods available today to resolve substantial litigation matters is the utilization of the mediation process which uses neutral persons to facilitate communication between the parties to assist them in reaching an agreeable solution. See, CCP §1775.1(a)(2). Since the process of mediation is a voluntary one, it can be employed at strategically critical times during the litigation, utilizing mediators who are best suited to the litigation and respected by both parties thereby enhancing the chances of a workable solution. It is the purpose of this paper to outline some of the highlights of the mediation process to be used as a backdrop to the lecture discussion on the utilization of the mediation process itself to accomplish the results intended. Beginning The Process Of Mediation Normally, the mediation process cannot begin unless one of the litigants is willing to suggest this alternative dispute resolution means. Unless the practitioner is willing to make the first move, the sides will remain at an impasse with a potential unfortunate result of never reaching an amicable conclusion to the matter. It is important that the suggestion of mediation not be done unless there is an opportunity to present the suggestion in such a way that it does not convey a message of weakness to the opposing side or an anxious attitude to conclude the matter. Communication to opposing counsel at any time is appropriate when considering mediation, but it is best to convey this opportunity when you are in command of the facts of your case, know its strengths and weaknesses and therefore can present a firm command of the value of your case. Naturally, exploring mediation too soon before case facts are fully developed may not be productive. After litigation proceeds, and at some point when you are able to determine the real strengths of your case, is usually the best time to approach the mediation process. At this point, both sides know the lay of the land, damages become clearer and an estimation of the value of the case can be made more realistically so as to bring about agreement to conclude the matter. Accordingly, enticing the opponents into a mediation process ought to be done from a position of strength and knowledge, with an attitude of fairness and a sincere desire to bring about a fair resolution. All negotiating skills normally utilized in settlement negotiations need to be considered at this point as well. The Benefits Of Mediation It should be obvious to the casual observer that the mediation process allows the parties to avoid substantial expensive litigation, with the possibility of bringing about a fair value resolution to the controversy. There are also important additional benefits that can be achieved, such as, crafting a settlement agreement to avoid taxation of portions of a settlement, timing receipt of income to reduce taxation, and achieving confidentiality agreements, not otherwise available from a trial verdict. These opportunities can be substantial benefits in mediation as avoidance of taxation alone can make trial seem foolish. While avoidance of taxation in recent times has become more limited,
nevertheless the mediation process can allow the parties to explore whatever opportunities do exist beyond a simple money settlement. The Right Mediator Is Essential Before deciding to mediate, it is critical that you choose a person in whom you have the confidence to bring about an appropriate mediation for the given case. One should start with a known mediator and see if the opposing counsel will agree to such person. If not, then you must learn about the mediator proposed by the opposing side by way of personal references, CV evaluation and possibly interviewing the mediator on the telephone to assure yourself that this individual will have the necessary skills to bring about a purposeful process. Once you have selected the mediator with the appropriate background and skills to conduct the mediation, it is then important to decide where the mediation will be held. Usually, at a neutral location at the mediator's office is a good alternative so that neither feels a lack of a level playing field. Preparing For The Mediation Once you have arranged for the mediation, it is important to fully prepare for presentation of your case to enable the mediator to work with both sides in forging an amicable resolution. Normally, each side presents a conference statement brief outlining the facts of the controversy, the legal issues at stake, damages and their calculation, as well as appending critical exhibits for examination. The brief is usually confidential to either side so that the mediator can obtain a full understanding of either side's position. Taking the time to prepare a comprehensive brief of the case not only facilitates mediation but also gives the litigant confidence in the knowledge of one's case and the assurance that if the mediation fails, further preparation of the case will proceed with more focus and ease. It is also important to prepare one's client for the mediation process by informing the client of what will happen at the mediation and how the client is to present their position of the case. Inevitably, in the mediation process a joint session occurs when each side presents their view of the case with the attorneys presenting first and then clients and interested parties offering their insights afterwards. In this way, the joint session allows a full airing of the matter, so that the mediator can fully understand each position of the litigants for purposes of the negotiating sessions to follow. Preparing for the mediation joint session is much like preparing a case for a settlement conference with the addition of presentation of a opening statement. Preparation is the key with a solid understanding of the nuances of one's case. Being unprepared for mediation undermines the process and can only lead to frustration between the litigants. The Negotiation Phase Once the joint presentation is completed, and both sides have a full understanding of their cases, the parties usually split into different rooms with the mediator discussing the settlement strategies with each party privately. This is no different than the settlement conference with which most attorneys are familiar and it proceeds along much the same lines. The main difference in the negotiating session in a mediation, is that the parties have exchanged a fuller explanation of their cases,
and the mediator is now taking the time with a complete understanding of the case to negotiate with the parties. It is during this phase that each party must employ all negotiating strategies normally utilized in trying to determine the ultimate settlement position. In this regard, it is important to be flexible and willing to listen to the mediator's comments when assessing one's own case, and to be forceful and affirmative with the mediator to insure that he or she will advocate your strong points to the opposing side. The key to successful negotiation is knowing your own case, having a realistic assessment of its value and be willing to stand firm if necessary or compromise in the face of factors previously not considered or overestimated. Conclusion Of The Mediation If the mediation concludes in an amicable settlement of the matter, it is usually followed by a written settlement document. This needn't be done at the mediation as in many cases it is left to the parties to exchange the settlement document in the few weeks following the mediation. If there is any concern that either side may have buyer's remorse, it might be worthwhile to bring a proposed settlement document to the mediation and work it out at the time having all parties sign off on the matter. It is also important that the contents of the settlement document be identified, such as, characterization of the damages for tax purposes, indemnification provisions, attorney fee clauses, arbitration provisions, etc., so that none of these smaller points lead to impasse afterwards especially once the main aspect of the mediation is conclusion. Conclusion The mediation process can be as exciting and dynamic as the trial process if taken seriously and prepared for well in advance. Presentation of the client's case during the joint session marshalling all the facts and explaining why the opposing side has significant exposure should motivate the advocate to not only utilize the mediation process but to view it as a strategic tool in resolving often difficult and potentially expensive and time consuming litigation very often beneficial to no one. A fuller understanding of the mediation process should reveal to counsel the obvious benefits to all concern