As mediators whether we like it or not money is more likely than not to be the most important dynamic which we deal with when helping the parties to resolve their dispute.
An excellent book “Making Money Talk – How to Mediate Insured Claims and Other Monetary Disputes” which is written by a US Lawyer and Mediator, J Anderson Little who has mediated at least 4,000 cases mostly in the context of personal injury litigation illustrates how a mediator can bridge the difference between parties and plays a crucial role in enabling settlement.
Little has identified a series of ways to help bridge parties together within mediation where the primary dynamic is money rather than relationships.
The book deals with the recurring problems presented in the negotiation of insured claims and provides a series of tools to help the parties move beyond impasse.
It is split into 9 Chapters and covers:
· The Realities of Negotiations about Money
· Making A Place For Traditional Bargaining among the Models of the Mediation Process
· Facilitating Movement – Understanding the Problems of Movement in Traditional Bargaining
· Facilitating Movement: Helping Negotiators Overcome Their Negative Reactions To The Other Side’s Proposals
· Tools of The Trade – The Skills of the Mediator
· Responding To Recurring Problems of Movement in Traditional Bargaining: 25 Settlement Clichés
· Closing the Gap: From Best Numbers to Settlement
· Other Models of the Mediation Process: Their Uses and Limitations in Civil Trial Court Mediation
· Standards of Conduct in the Mediation of Civil Litigation
Whilst the book is primarily written to assist mediators, it has much use towards negotiators within the mediation in the process. As Little correctly observes most lawyers do not have any such strategy for use of the mediation process.
The flawed approach of negotiators is this. “Most negotiators act reflexively. They develop their next proposal in reaction to the other side’s last proposal. If they like it, they move. If they don’t like it, they don’t move.”
This leads Anderson to observe ”The crux of the problem is that most negotiators never get beyond case analysis to develop any plan for movement during the negotiation. They simply develop proposals in reaction to the other side’s proposals. They are reactive rather than proactive. They focus on the other side and the movement the other side is making, rather than on their own goals and the movement within their range of settlement that they’re able to make.”
Against a background where many lawyers will prepare for mediation exclusively on the law, if at all, where should their preparation be?
Little observes that means answering a series of questions, which include:
“After I have reviewed my case,
After I have decided what I get on a good day and on a bad day in court,
After I have factored in all of the costs and contingencies,
After I have conducted a thorough case analysis,
After all of that,
At what number will I start the negotiation?
At what number will I walk away from it? and
How will I move from number to number in between?”
Another problem with negotiation which you find in civil and commercial litigation cases is that the Claimants start much higher than their own case analysis supports and Defendants start low in reaction to the claimant’s high opening figure.
As neither party has a plan as to what happens next, the mediation process is destined to fail unless the mediator can help the parties bridge the gap.
As Little observes the key is that the mediators should concentrate not on settlement but on eliciting well though out proposals that encourage movement.
From the parties perspectives one way forward for the parties to develop a detailed plan for the conduct of the negotiations.
One option which Little advocates is to develop a plan for how the negotiation will evolve. This proceeds by dividing up the available range for negotiation into a number of equal increments say moving from an opening gambit of £100,000 to a walk away position of £50,000.
An advantage of preparation in this way is that you are not so reactive to the other side and effectively you can leave the negotiation on your own terms if you do not obtain what you want.
By making a series of positive ways from a not unreasonable position, a party can plot its way to a settlement it can live with.
Overall there can be dangers in having a too rigid a plan. As Little observes ones views of the case inevitably changes over the course of the mediation. Another point is that a party’s bottom line changes and under pressure a party can yield from their walk away figure if they realise how close they are to settlement.
Nevertheless good preparation is really key to ensuring you and your client get the most out of the mediation process.
For mediators there is much practical assistance given to them from Little and this is where the book justifies its purpose.
Perhaps mediators will take much out of the book on the Chapter in Responding Recurring Problems of Movement in Traditional Bargaining: 25 Settlement Conference Clichés.
In his easy reading style, Little provides a series of practical tips which will help any mediator.
By way of example Little explores how to deal with a Claimant whose 1st proposal is higher than his case analysis which is often motivated by a fear of selling himself too short.
As Little points out “The proposal the claimant’s team is about to make is a dangerous one. It will engender a predictable reaction from the defence team and will adversely affect the prospects for a successful negotiation.”
Little’s solution “I suggest here that the mediator anticipate an adverse reaction on the part of the defence and work to help the claimant make a more thoughtful first proposal. My comments would be structured to identify the need(fear) that prompted the proposal, to invent several different options for handling the opening proposal, and to explore the pros and cons of those options by discussing the impact of each on the other team’s first proposal.”
Other issues explored represent a checklist of problems which mediators encounter such as one party reacting strongly to a perceived outlandish proposal, “This Case Isn’t Going To Settle” “Tell Them We’re Not Going Any Higher/Lower.”
With respect to the latter point as Little writes he knows from experience that the party making the statement will probably go further particularly if it is the first time he has said it within the negotiation. As he does throughout the book he uses transcripts of conversations that mediators can have the lawyers (or parties) and shows how he keeps the mediation moving forwards.
Ethical conduct of the mediator is bound to play an increased role in the United Kingdom and Little can provide his thoughts from the United States. As he writes ”Civil trial court mediators are accused routinely of being directive and they are faulted for relying heavily on the use of opinions. Critics believe that civil trial court mediators are not truly mediators; they are neutral evaluators in disguise”
Expect this issue to run and run.