By Judge Darrel Lewis (Ret.)
Use the mediator to your advantage. Many cases are resolved before trial simply by counsel getting together and negotiating a resolution. This is certainly advantageous to everyone involved. However, direct negotiation may not be appropriate or fruitful in every case. One may be reluctant to disclose true goals or priorities directly to one's adversary for fear that the information will be used against you if the case does not settle. There is also the possibility that the suggestion of negotiation or mediation may be interpreted as a sign of weakness. It can also be a clumsy or awkward process where you either negotiate in the presence of your client or you negotiate and then have to explain to your client why he/she should take a negotiated deal that is much less than the full potential of the case for the plaintiff or more than defendant's evaluation of the case.
Most forms of Alternative Dispute Resolution (ADR) overcome these deficiencies of direct negotiation. However, there may still be some reluctance to be the one to suggest ADR, again out of fear that this may be interpreted as a sign of weakness. One way out of this is to contact a mediator and have the mediator call opposing counsel and say, “I was just talking to opposing counsel and he/she mentioned this case and I suggested that all of you come in and mediate it.”
Make certain your client understands the process. Don't assume that your client even understands what the terms “ADR,” “mediation,” “arbitration” or “settlement conference” mean. Your client needs to be told of the difference between the adversarial nature of trial or arbitration and the consensual, cooperative process of mediation. Your client should understand that in a mediation no one will be making decisions for him/her. The client is the decision-maker in a mediation. Remind him/ her that although harsh words, intractable positions and ultimate demands may be acceptable as “saber rattling” in preparation to do battle in the courtroom, such conduct will not be productive for settlement. If your client is particularly apprehensive about the prospect of mediation, you and/or your client can even visit or call the mediator in your case, or perhaps a different mediator, to discuss the general procedure. (If you contact the mediator in your case, you should first get the consent of your opponent and you should not discuss the merits of your case with the mediator.)
Prepare your client to participate in the process. Most clients, if they have been to any court proceedings with you, have sat passively and observed your brilliant performance. Most insurance adjusters are accustomed to simply being present at certain proceedings in order to state how much money the company will pay and to report back any progress to the decision-maker back at the office. However, most mediators are now using a more participatory approach in which they expect the client to be able to explain the facts of his/her case regardless of whether your client is a layperson, a corporate representative or an adjuster. This means that the representative or adjuster must be familiar enough with the facts of the case to justify his/her position and to re-evaluate that position in light of information that arises during the mediation. Many, many cases settle because the plaintiff has an opportunity to express him/herself to an empathic listener and the adjuster has an opportunity to meet the real live person behind the cold paper filed.
Prepare your client (and yourself) to be conciliatory and empathic. You need not admit fault or agree with the other side's position in order to express your concern for the injury or pain suffered or even the stress and expense of the litigation. Yet, in mediation, a little compassion can go a long way. There is nothing wrong with stating that you believe in your case, but that you recognize the inherent risks and cost of trial in all litigation and that you would like to find a resolution that will save both sides that risk, stress and cost of trial.
Prepare the mediator. Talk to the mediator before the mediation date to alert him/her to any strong emotional factors. Also alert him/her to any cultural taboos relating to any person in the case and how to pronounce any unusual names. The mediator must establish rapport with everyone. If he/she begins by unwittingly offending or embarrassing someone (especially on the other side), that behavior can prolong or spoil the mediation by affecting his/her ability to be persuasive with that side.
Submit a concise and factual brief. This is not a trial brief. Save the inflammatory, argumentative language for trial. Send a copy of your brief to opposing counsel. So called “confidential briefs” sent only to the mediator are problematic. Certainly all of the information you put in your brief cannot be truly confidential. Consequently, the mediator is left to guess what is really not to be disclosed and what, in fact, needs to be disclosed. Nothing in writing is truly confidential anyway. The mediator could inadvertently leave your “confidential” brief on the desk or table for your opponent's eyes. If you have a tidbit of information that is truly confidential, it is better to disclose this to the mediator orally either before or during the mediation. It is generally better not to state a new demand or offer in your brief. This tends to anchor you to that position and it encourages the opposing side to anchor to a polar position.
Prepare your opponent. I know that this is contrary to your basic instincts as a trial attorney, but it is critical for a successful mediation. Generally, the more your opponent knows about the strengths of your case, before the mediation , the more successful you will be in the mediation. This is especially true for institutional parties. Insurance companies, governmental entities and large corporations do not send representatives with unfettered authority. The limit of the representative's authority will have been set long before the mediation and it normally cannot be easily increased. The true decision-makers need to have a full and persuasive presentation of your case weeks before the mediation . This is best done by you sending a mediation brief or demand letter well in advance of the mediation. Surprising the representative at the mediation with new evidence or arguments will simply frustrate and embarrass the representative and the attorney and cause them to minimize the importance of this information when they pass it on to the true decision-makers.
Be sure that everyone understands that the process is confidential. In California , there should be no need to prepare a separate confidentiality agreement. Statutory and case law, including, but not limited to, California Evidence Code §§ 1115 through 1154 and 703.5 establish the confidential nature of settlement negotiations. A reminder of this, however, may help put people at ease and promote more frank discussion of the case.
Take advantage of the opportunity for creativity. Trial verdicts, contingency fees and price earning ratios of insurance companies are stated in dollar amounts. Consequently, attorneys (and clients, too) normally come into a mediation with dollar signs as the main focal point. However, I have seen numerous cases settle because of an apology, a recognition of injury, a simple recognition of debt (even without payment), structured settlements, time payments, return of property, repair of damage, and promises to do or not do things in the future. The list is literally endless but the point is the same - mere dollars are often times not the only answer.
Make sure your client understands the full financial analysis of settlement versus trial. I cannot count the number of shocked (or pleased) looks I have seen on plaintiffs' faces when I demonstrate for them how they will receive more in their pocket now from a $50,000 settlement than they will from a $65,000 judgment later . Naturally, along with this is the analysis of what that pocket will receive (or pay out) if the verdict is $25,000, $85,000 or $0 and the estimated likelihood of those various outcomes. Of course, “the bird in the hand” theory is quite applicable at this time because many clients have not considered the time value of money and they do not understand that a favorable verdict does not mean the instant money in the pocket that normally results from a settlement. Don't forget to include a discussion of the impact of any CCP 998 offers that have been, or may be, made and the stress and personal time that will be involved in preparing for and conducting a trial. This analysis, in detail, perhaps is best done during negotiations when the settlement options become a little more concrete and the reality of trial is looming. This also would be an appropriate time to remind your client of whether your fee structure is the same with a settlement as it is after trial. A similar reminder is appropriate to defendants of how fees and costs will add to the overall pay out after trial. For more sophisticated defendants it may be helpful to construct a decision tree to graphically display the various potential verdicts, costs and probability factors in order to come up with a statistically supported settlement value.
Reconsider the wisdom of the hidden “bomb” you are reserving for trial. This is a mediator's dilemma. The case won't settle and one side explains that they will not make a better offer because they have some secret evidence that they intend to spring on the opposition at trial. Obviously, the mediator can only reveal as much of this information as the party explicitly authorizes. However, such information should be disclosed to the mediator because he/she may: (1) know that the other side is already aware of the evidence, (2) help you evaluate the true impact of the evidence, (3) with your consent, disclose all or part of the evidence or simply the fact that there is some hidden evidence that he/she cannot disclose, (4) without disclosing the secret, determine if the other side is aware of the evidence, or what their explanation or reaction to it might be.
Ultimately, you should give serious thought to disclosing the information. Pretrial discovery does serve a purpose. It can save you from being surprised by your surprise. Surprise evidence in trial will have one of five results: (1) it will devastate your opponent and make you a hero, (2) the other side will have a perfectly good explanation for it and you will have gone to trial on a case you could have settled, (3) the evidence will turn out to be unreliable or erroneous and will adversely affect the credibility of you and your client, (4) the other side will also have some secret evidence in rebuttal to yours that will cause yours to fizzle or even backfire or, (5) the judge will rule the evidence inadmissible. Remember, result #1 is only one of five possible results. You must ask yourself: “Is it worth the gamble?”
Allow enough time. The average mediation in a fairly simple case takes four to eight hours. Studies have shown that, in simple cases, 3-hour mediations are far more successful than 2-hour mediations. The basic reason is that a mediator must establish rapport with the participants and give them an opportunity to be heard before they will take to heart any advice or evaluation that the mediator offers. (As in: “No one cares how much you know until they know how much you care”) A good mediator will work with you late into the evening if that's what it takes. You and your client should be prepared for that.
Be prepared for the case to settle. This may seem quite elementary, but I can't tell you how many attorneys and clients enter the mediation with the attitude that “this case cannot be settled.” Then, they are taken by surprise when it does settle. Naturally you will have all of the required persons present with full authority to settle. However, if there is some supervisor, spouse, partner or paralegal friend that needs to be consulted before a final agreement is made, make certain that person is available at all hours until the mediation is concluded. Negotiate liens ahead of time. At least have some idea what the lien holder will take, based upon different settlement hypotheticals. Have the name and telephone number of the lien-holder so the mediator can work with that person to settle the entire case. Lien holders are normally more willing to negotiate if they know their concession will settle the case and they will get their money within weeks.
Don't leave until the paperwork is done. When a settlement is finally reached, it may be late and everyone may be tired, but it is much more efficient to prepare the settlement language in a joint session than to exchange written versions for the next few days or weeks. In California , you have an expedited means of enforcing a settlement, but only if it is on the record or in writing and signed by the parties (CCP 664.6). It seems to be accepted that an insurance representative can sign on behalf of an insured defendant who has no personal liability.
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