Posts Tagged ‘negotiations at mediation’

THE MEDIATOR’S PROPOSAL

Because of misconceptions regarding a mediator’s proposal, I am taking this opportunity to clarify them.

What is a mediator’s proposal? It is just that, a proposal by a mediator for settling litigation between the parties. It does not indicate the mediator’s opinion of the merits of the case. Instead, it reflects his educated guess as to the terms that all of the parties will find acceptable.

When is a mediator’s proposal made? There are no rules for when it should be made, just as there are no formal rules for how any other part of a mediation should be run other than that the process must be conducted under a cloak of confidentiality. Experience, however, shows that a proposal is most effective when the parties have reached a stalemate and there are no other methods of breaking it.
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BREAKING AN IMPASSE AT MEDIATION

Occasionally, during a mediation, the discussions cease being fruitful because of unrealistic expectations, a disagreement over material facts, bad timing (incomplete discovery; an impending motion for summary judgment), the failure of one side to have sufficient settlement authority or the absence of an essential party. This message discusses ways of breaking an impasse when the expectations of the parties (usually over the monetary value of the case) are far apart.
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THE LAST-MINUTE DEAL BREAKER

After several hours of intense back-and-forth discussions, the mediation process prevails once again and the mediator, with great satisfaction, informs one of the parties that “We’ve got a deal!” only to be told, in response, “Oh, by the way, we can only make payments in installments” or that “We must have a confidentiality clause; substantial liquidated damages for breach of the confidentiality clause and/or a stipulated judgment for an amount far above the settlement figure.” Not surprisingly, the timing of this additional condition or conditions is enough to cause the other side to feel that it has been blind sided and, as a result, to threaten withdrawal of its offer.
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Who Goes First?

Message no. 13 discussed the issues to consider in deciding what an opening offer or demand should consist of. This message looks at which side should make that first move.

Typically, plaintiffs and defendants appear to be comfortable with the former making a demand and the latter responding to it. Both sides, though, should consider the advantages and disadvantages of sticking to or deviating from this order rather than maintaining the status quo.
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The Opening Offer

The opening offer or demand, for obvious reasons, ranks far below any final settlement figure in importance. Nevertheless, it is a critical step in the mediation process and can have an impact on whether the matter settles and, if so, at what amount.

Pepperdine Law School’s Straus Institute for Dispute Resolution teaches that the opening offer falls within four self-explanatory zones: “zone of agreement,” “reasonable,” “credible” or “insult.” This message discusses some of the inter-related issues attorneys should consider as affecting which zone they want their first offer to come within.
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