Mediation is one of the aspects of litigation that can be confusing for parties in a lawsuit, but there are few rules to understand about the process that can make it a lot less daunting. Mediation is a non-binding meeting where the parties in a lawsuit hire an independent mediator (a retired judge or lawyer) to try to reach a settlement. Here are five rules a party should understand before attending a mediation:
1. The mediator will make you feel uncomfortable about your case.
As I wrote in a prior post, a mediator’s only role is to get the case settled. He or she is not there to be your friend, not to tell you what they feel the case is worth, or to protect your opponent’s position. Their job is to get a settlement. Put yourself in the mediator’s position: you have two adversarial parties who hate each other and believe they will win if their case goes to trial. How, as a mediator, do you get the parties to move off their respective beliefs? You must attack both sides’ theory of the case by pointing out the weaknesses of each position.
So don’t take the attacks personally, or think that the mediator is only attacking your position. If the mediator is persuasive about how weak your case is, she is equally persuasive to other side. Understand that the attacks are not personal, are not necessarily how the mediator perceives the value of your case, but are a tool to get the case resolved.
2. Before the mediation, set a bottom walk-away number, but also a number that represents a goal.
It is important to know what your last best and final number is prior to going into the mediation. Steve Pearl, a mediator, explains:
Experienced negotiators will set not only the walkaway numbers beyond which they will not move, but also goals that are better than those walkaway numbers. Parties who set “shoot for” numbers as their reference points typically do better than those who only formulate walkaway numbers.
However, just like almost every negotiation “rule” there are drawbacks in setting a walk-away numbers. Pearl explains that sometimes parties may have to shift their reference points to resolve the case. So, parties should have clear numbers set going into the mediation, but must also have a mechanism to reevaluate these goals if the case will not settle within these predetermined numbers.
3. Understand when being cooperative will help you get a better deal.
A party involved in a mediation must understand that there are two parts to a mediation: (1) the process and (2) the content. The process is how you interact with the other party: are you cordial or you make small talk? The content is the subject being negotiated, such as the dollar amounts. A party that is cooperative about the process and competitive about the content will do better overall in a mediation than compared to a party that is competitive on both the process and content.
Think about how you interact with someone that is simply being a jerk to you on ever single issue, even issues that do not impact the subject being negotiated. When dealing with the hyper-competitive negotiator, your guard goes up and the negotiation turns more personal. This is a bad combination for attempting to reach a reasonable settlement.
4. Understand what you should and will say during the mediation.
As a party, you need to understand from your attorney how the process will work. Will there be a joint session with the other counsel and party in the same room? Or will all parties remain in separate rooms? During COVID-19 how will the Zoom meeting take place?
Generally speaking, what is said during a mediation is confidential. However, if a party makes an admission or statement during the mediation, if the case does not settle, the opposing party can then seek discovery to obtain that same information through other means in order to use in the case.
Work out with your attorney when you should speak and what you should say. Also important is to be careful on how you react to the mediator when he or she presents counteroffers. The mediator is likely watching your reaction to gauge where you as the decision maker ultimately stand.
5. If you make a “last, best and final offer,” make it your last best and final offer.
Parties’ statements made during a mediation must have credibility. If you make a “last, best and final offer” during a mediation, and the other side rejects the offer, but you continue to negotiate, you have lost credibility with the other party and the mediator. As a result, even if you continue to negotiate and truly reach your last, best and final offer, the other side (and the mediator) will not believe that is your final number and will continue to push you beyond this number. There are occasions to make a last, best and final offer, but if you qualify your offer as such, be ready to walk out of the mediation if the offer is rejected.