By: Richard P. Byrne Esq.
New York Law Journal Litigation Special Report
While the majority of disputes resolve at Mediation, there nonetheless remain those that impasse. At times, the lack of success stems from individual issues unique to the matter at hand. Often, however, the failure to achieve resolution flows from more general causes which can be avoided if adequate thought is given to these potential pitfalls in advance of the session. The purpose of this article is to prospectively identify the leading reasons why Mediations fail, rather than looking back on causes after the fact.
Lack of Preparation
Many attorneys are familiar with the old adage that “Cases which get prepared for trial settle and cases which are prepared for settlement get tried”. On this spectrum, Mediations should be viewed as much more akin to trial with “preparation, preparation, preparation” being the mantra. Mediations provide that moment in time which is part of – yet removed from – the litigation process. They allow attorneys to advance positions to their adversaries (and, more importantly, to their adversaries’ clients) via direct presentations and indirect communications through the Mediator. Isn’t this, on some level, every attorney’s ideal? To have a conduit to the other side without the information passing through the filter of opposing counsel?
Why, then, do some attorneys not adequately prepare for that opportunity?
Oftentimes, it is just a matter of attitude – where the Mediation is not viewed as necessarily dispositive, and is simply seen as a weigh station along the litigation track – perhaps, as just a means to perform some “free discovery” and test parameters on settlement with the underlying thought that another session can be scheduled down the line. That, of course, assumes that you will not have lost that opportunity by frustrating and turning off the other side – who came fully prepared and ready to engage on all issues.
Absence of Decision-Makers
Whether it arises from the literal absence of a decision-maker at the Mediation session or the attendance of a party representative with limited authority who must communicate back to others, the lack of a living, breathing person empowered to resolve the dispute and with whom the Mediator can engage is always problematic. Absentee decision-makers do not obviously participate in the negotiations in “real time” nor can they appreciate the nuances of the situation as it is developing. And setting aside the substance of the matter, the logistical hurdles and delays in communication serve only to frustrate matters and, again, “turn off” the other side –who came prepared to negotiate with a counterpart.
Wearing Trial Blinders
Resolving a dispute through Mediation on the eve of trial presents a unique challenge because the parties’ counsel are in the “trial zone” – the zone in which settlement may no longer necessarily be seen as the goal with the focus, instead, on prevailing at trial. When in “the zone”, both sets of counsel may have difficulty listening to critiques of their respective client’s positions. Valid points conveyed may be met by an immediate, snappy and defensive response – without acknowledgment that the point may have legitimacy.
The challenge to the Mediator is to find a means by which the “trial blinders” can be removed in order to allow for meaningful discussions and effective negotiations. Some suggest having a “negotiating” or settlement attorney attend in lieu of trial counsel. This Mediator does not agree with that approach and believes it is absolutely necessary to have trial counsel present. Even if they are fully immersed in “trial mode”, they, nonetheless, remain the number one resource for the Mediator to utilize in securing factual and legal ammunition to use with the other side.
If, despite best efforts, the Mediator cannot reach a breakthrough with trial counsel, they alternatively need to identify through the caucus process someone else at the table who is one-step removed and, therefore, perhaps a bit more objective. Focus and attention should be brought to that person with the intention and hope that he or she will then have adequate influence on the balance of their team and its trial counsel behind closed doors. It becomes telling for the Mediator, of course, when that person begins to take on a more active role and evolves to serve as the spokesperson for the group. It is a clear sign of progress and bodes well for continued negotiations.
Last Minute Surprises
Oftentimes, parties come to a Mediation session completely focused on “big picture” issues – their leading claims and defenses and the consequent damages they are seeking to advance or refute. Great time and labor is then invested in the ensuing debate and negotiations relative to these issues. Indeed, significant progress may be seen during the course of the Mediation session to the point where the parties, in fact, believe that a deal has been struck and that a settlement in principle has been achieved.
That is, until one side interposes a condition which, to them, might have been an afterthought. Presented as an “Oh, by the way” point, it nonetheless ends up scuttling the settlement because it was not anticipated by the adversary and it is not, despite the soft sell, considered a minor point. The introduction of such an ill-timed condition then spirals into intellectual craftsmanship of increasingly heightened doomsday scenarios that require the introduction of conditions upon conditions and the loss of the progress and good will which had been achieved. These conditions can take a variety of forms – confidentiality provisions, the need for payment over time, employment of form Releases, indemnity and hold harmless requirements, liquidated damages clauses, etc., etc. Conflict arises because these components may be standard operating fare for one party (particularly large corporations or insurers) and are not front and center in the minds of their counsel as the Mediation gets underway. In contrast, the required terms are unknown and unanticipated to the other side, whose counsel will cry foul upon their first mention at day’s end.
The path to avoiding this encounter is simple enough, although rarely taken – counsel should place any such conditions on the table at the start of the Mediation session. While it may seem somewhat out of sync, the requirements are much more innocuous and apt to be successfully addressed at 9:00 a.m. rather than at 5:00 p.m. when they may take on a life of their own and serve only to re-ignite flames from darkening embers.
Some practitioners are hesitant to announce such conditions at the start of a Mediation session out of fear that they may be misperceived as weaknesses or an anxiousness to settle. To alleviate any such concerns, the Mediator can be employed to keep both sides on equal footing by inquiring at joint session if the parties have any required terms or conditions – assuming that an agreement can be reached on the substantive components of a settlement by the end of the day.
Emotion and Anxiety
The approach of Mediation is often marked with the advent of emotion and anxiety for clients, even if they are hard-shelled professionals. The dispute in question may be long-running, contentious, expensive and even personal, and now it is building to a crescendo. Practitioners, in their advocacy mode, may even stoke the clients’ anxiety levels in advance of the session as preparation is underway. Thus, clients may enter a Mediation tightly wound and with fuses lit.
Here, a Mediator – true to his or her title and role – needs to keep matters in balance and, slowly, as the session proceeds, allow the pressure to be released. Addressing this psychological component of a Mediation is often as critical as the substantive issues. Failure to do so can lead to an impasse.
The clients (and, frankly, sometimes their counsel), do need the opportunity to vent – to complain about the miserable adversaries on the other side, the havoc which they have wrought in the pursuit of their nonsensical claims/defenses, and the injustice of it all. If that ability to “get things off their chest” is not allowed – or, worse, is blocked by the Mediator – catharsis cannot begin, and the Mediator may find him or herself perceived as disinterested or ineffective because “he/she is not listening to me.” If that occurs, the Mediation may begin to head off the track from its inception and not be able to recover. That is not to say, however, that the clients should be permitted to stay upon their soap box indefinitely and hijack the session. Equilibrium needs to be maintained while pressure is relieved so that the parties can get down to business and engage in negotiations driven less by emotion and more by substance.
While almost all practitioners operate at a frenetic pace, investing a modest amount of time in advance of a Mediation session to reflect upon the purpose, logistics and goal of the upcoming session will greatly reduce the potential for an impasse. In short, while it may sound trite, the more parties put into the process, the greater the results achieved.
Richard P. Byrne, Esq., is a member of NAM’s (National Arbitration and Mediation) Hearing Officer Panel and is available to arbitrate and mediate cases throughout the United States. In 2018, for the fourth year in a row, he was voted one of the Top 3 Mediators in the country by National Law Journal Reader Rankings Survey and for the second year in a row, he was named a National Law Journal 2017 Alternative Dispute Resolution Champion, as part of a select group of only 37 nationwide. Further, for the fourth straight year, he was voted a Top Ten Mediator in New York State by the 2017 New York Law Journal Reader Rankings Survey.
For any questions or comments, please contact Jacqueline I. Silvey/NAM General Counsel, via email at firstname.lastname@example.org or direct dial telephone at 516-941-3228.
Reprinted with permission from the December 18, 2017 issue of The New York Law Journal © 2017 ALM Media Properties, LLC. Further duplication without permission is prohibited. All rights reserved.