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 issues a party should understand to be better prepared for 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 different negotiating tactics that may be used during the mediation.
As a party, you need to understand from your attorney how the process will work. Mediators have a number of tactics they may use during the mediation process. Work with you attorney to understand what tactics may come up during the day, and how your will respond. Some of these tactics include the following:
- Negotiating by brackets: Instead of countering with a specific dollar amount, the party counters with range. Usually the range is express as: “If you agree to come to X, I will agree to go to Y.” Generally parties look to the midpoint of the bracket being offered as the party’s number being offered. However, thought must be given into how to respond to brackets.
- The mediator’s proposal: If the parties come to a standstill in the negotiations, a mediator may attempt to make a mediator’s proposal. The mediator usually will say that they can attempt to propose a number that is not based on the facts of the case or merit of the case, but solely on their feeling that it would be a number that both sides may accept. The mediator makes the proposal to each side independently, and each side must respond with a yes to accept the proposal or a no to reject the proposal – and only responds to the mediator so that the other party does not know their response. If a party rejects the proposal, the mediator does not inform that party if the other side accepted or rejected the proposal. Sometimes the mediator will give the parties a deadline by which to submit their response – such as 24 or 48 hours.
By understanding some of these tactics prior to a mediation, a party can be much more informed about the process and can make better decisions during the mediation.
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.