by Peter J Keel, Mediator

This article looks at the mediation process from the decision to mediate until the resolution of the dispute. It provides practical advice as to how to approach each stage of the mediation.

There are many ways of resolving disputes – at one extreme is negotiation between parties. This generally remains confidential and if it can be achieved is the cheapest and often the most efficacious means of resolution. Mediation sits next to negotiation because it provides a process by means of which an expert trained in the process assists and guides the parties and their advisors towards a resolution. Unless the parties otherwise agree, it remains confidential.

At the other end of the dispute resolution continuum lies the all-too-familiar court resolution process. The court imposes a decision and can only adjudicate on limited bases eg contractural or statutory. This limits the remedies that are available and the level of creativity that might be applied to the resolution of the dispute. Court proceedings are expensive and open to public and press scrutiny. It also has its ups and downs, mainly downs, when senior executives are called to be cross examined. Outcomes can turn on the slightest of evidence.

Negotiation and mediation on the other hand are private and far less expensive than going to court. They are only limited in the way that they can come up with solutions by the creativity of the parties. And we all know that one way or another something like 90% of cases are settled before hearing.

Of course at any time during mediation other processes along the dispute resolution continuum may be adopted, either singly or together. It’s not unusual during or prior to a mediation to hive off a question of law to an expert in order to shorten the mediation and take away another opportunity for argument.

The process

Allan J Stitt has written an excellent book, part of which examines the history of mediation and litigation. Paraphrasing, once we stopped throwing sticks and stones at each other systems of negotiation developed – it may have been village, or even small town based –  but as societies became more complex a more structured system run by judges was adopted. Such systems become time consuming and expensive. That leads to disputants trying to develop systems that are cheaper and more efficient. Hence for the last 30 years we have been examining alternatives.

When we talk about the mediation process however, we are really referring to a set of guidelines that have been developed over time that are used by the mediator to assist the parties coming to a resolution of the issues between them. The process is infinitely flexible and can be as simple or as complex as is warranted. Not all of the steps are used in every mediation, but some mediators prefer to use more rather than less.

Whether or not to mediate

Sir Laurence Street wrote in 1993 the following:

“Mediation has a range of potential benefits.

  • It can take place quickly and often with relatively little expense in contrast to taking the dispute to a court, to a tribunal or to arbitration.
  • It focuses on the parties’ real commercial interests and emotional and psychological needs and not just on their legal rights.
  • It gives the parties an opportunity to participate directly and informally in resolving their own dispute.
  • It gives the parties control over the process itself and the outcome.
  • It exchanges the unpredictable outcome of litigation or arbitration for the certainty of a negotiated consensus.
  • It produces outcomes which are likely to endure because the parties themselves have chosen them.”

I would add to these the flexibility of the process, and the ability to craft creative solutions.

The other factors that might contribute to the decision are, what the Americans call, your BATNAS. This means best alternative to a negotiated agreement. Many practitioners consider these without thought, and every party considering mediation should thoroughly have explored all the BATNAs. It’s worth thinking about the consequence of not getting to a resolution.

Some alternatives include getting locked in a court battle – these are expensive. At court, if the judge gets it wrong, an appeal follows. Parties stop talking. People litigate on principle. This is dangerous. People endlessly negotiate. People become obsessed and the business, and/or their health suffer. The press get wind of an issue, and get the facts wrong. Insurers get involved. Defamation proceedings are threatened or commenced. Executive time that should be spent elsewhere gets diverted. It’s worth examining the BATNAs and their cost, and not just the monetary cost.

Any number of matters go into considering whether or not to mediate. Most important is the willingness of the parties to participate. Mediation can take place at any time, from when the dispute is nascent until it is running in court, but at the core of the process is the willingness of the parties to take part.

Preparation for mediation

Mediation is a voluntary process, although parties may be bound contractually or may be ordered by a court to mediate a dispute.

Often, when parties agree to participate in a mediation it is arranged by their lawyers. Obviously, the mediation process is most likely to succeed when the parties voluntarily engage at the mediation itself.

The parties must select a mediator. The process of selection may be undertaken however the parties wish to do so, and there are organisations like the Australian Disputes Centre and the Law Society that can assist. Remember of course the qualities that make a good mediator. I have quoted Sir Laurence Street before, and it is worth repeating, at least in part.

“(Mediators)…should  be properly qualified as mediators and experienced in communication and negotiation in order to be able to guide the parties in their negotiations. Familiarity with and experience in the litigation process are of great assistance, but eminence in professions other than mediation is in itself not enough.

Expert knowledge of the field of dispute is not essential; the requisite skills are analytical and empathetic person skills.

Mediators need personal qualities that enable them to relate comfortably to each of the parties. Significant amongst these personal qualities are the humility to be non- judgemental in relation to each party’s mind-set and the readiness to empathise with their respective points of view. Understanding and responding to (but not necessarily agreeing with) their individual perceptions are important pre-requisites to building with each party the relationship of trust and confidence in the mediator that will transcend into trust and confidence in the mediation process. Once the parties have developed trust and confidence in the mediator and the mediation process, the mediator will be better able to guide them along the path towards consensus.”

Having selected a mediator, the parties appoint him or her and all sign a mediation agreement.The mediation agreement will include clauses reciting confidentiality obligations, the bases upon which fees are paid, and most likely obligations of good faith. Mediators generally have their own agreements which they will require parties to sign before the commencement of the mediation.

There may be a meeting of some kind – a preliminary conference – with the mediator. It will either be face to face or by zoom or teleconference. Prior to the mediation logistics have to be sorted out. Where will the mediation be held, and who will make those arrangements, when will it be held, will position papers be exchanged?

In considering whether or not to have a preliminary conference with the mediator, there are pros and cons.  The biggest con is the cost. Much of the work can be done on the day of the mediation, that said many people like having it out of the way. The greatest pros that I see are that it can act as the first ice breaker between the parties, and serve as an opportunity for the parties to become comfortable with the mediator.

The mediator may invite the parties to exchange position statements. They serve to provide the mediator with an outline of the dispute, and to update the parties on their respective positions.

The downside – they are often drawn up by lawyers, cost a lot and reinforce parties’ entrenched positions. If it is felt there is a need, then they should be short and focussed. Position papers are not submissions, and should not be thought of as such. The mediator is not an adjudicator. If position papers are called for, they should be framed in a way that outlines a party’s position, not in an overly combative way, and certainly not in a way that invites the mediator to determine any issues. That will not happen.

Many mediators find the position papers useful, some do not.

If there are any issues that need to be separately determined – be it. a question of law, an expert issue or an accounting issue – arrangements should be made to have these dealt with. If not, they will become stumbling blocks.

The mediation takes place on the day appointed by the parties and at a location determined by them.

The mediation

General

A question often asked is whether or not lawyers should attend the mediation. A lawyer’s role at a mediation is threefold:

First, a lawyer can advise a party on the law within his or her field of expertise, remembering that the legal position is generally only one component of a dispute.

Second, a lawyer can be an excellent sounding board for a client. Here the client is drawing upon the lawyer’s experience, not necessarily his or her expertise.

Third, the lawyer can document any deal.

There are also some things a lawyer should avoid. Avoid the temptation to strongly advocate a client’s position. This has no doubt already been done and to do so again can sabotage the process by forcing the parties back to their own corners, making the job of the mediator to get the parties to engage all the more difficult. It can also confuse the parties as to the purpose and process of the mediation.

The process is one of engagement, collaboration and ownership. It is for the parties to come to a resolution. Too often lawyers think they own the dispute and come to the process with the adversarial mindset that they have carried outside the mediation.

The mediator’s role

In coming into the mediation parties must understand the role of the mediator. The mediator is there for his or her expertise in helping parties come to a solution – not for expertise gained in another profession.

A mediator misconceives the role if he or she too easily risk the mediation process by proffering advice. The moment that there is a perception that the mediator favours the position of one of the parties, the mediator’s ability to encourage a collaborative approach is compromised.

As I was reminded in a recent refresher course, there is a good rule for mediators to live by – no advice. The mediator is there to facilitate and assist the parties to come to a solution to the issues between them, and a good mediator understands that the processes and methodologies in which they are trained and experienced will help the parties succeed.

The parties’ role

Parties to a mediation should not underestimate their role in the process nor should they underestimate the flexibility of the process. No one in the room knows more about the issues than the parties themselves, and no one can come up with more effective and creative solutions. A good mediator knows this and assists the parties to explore solutions.

One of the many benefits of the mediation process is that the parties are able to not only confidentially explore options but to creatively implement them. The only limit to solutions is the ability of the parties to agree. In preparing for a mediation parties must be creative. Have a wish list. With a good mediator the process will not only accomodate creative thinking, but encourage it.

The mediation itself

Mediations differ. Generally however they will follow the following steps.

The mediator will perform the housekeeping tasks, outlining to the parties how the day will proceed, making sure that the mediation agreement is signed, explaining the process, and outlining everybody’s respective roles.

Once this is done the mediator will invite each party to make an opening statement. From this the mediator will tease out issues for discussion. In effect, they will provide the agenda or the mediation.

The mediator will encourage exploration of the issues.

The mediator may or may not ask the parties to go into breakout rooms. The purpose of this is to encourage the parties to be more fulsome with their concerns with the mediator. What is said to the mediator remains confidential.

One school of thought does not allow for breakout rooms, questioning why the mediator should have more perfect knowledge than the parties. Ultimately, whether or not there is a breakout largely rests with the mediator.

After the breakout, the parties will reconvene and negotiate a final outcome.

As with all things preparation is critical. This includes not only an understanding of a party’s own position and flexibility, but also an understanding of the process and of the role of each person attending the mediation.