Continued from Part 1 and 2.
This requires the mediator to be multi-tasking. The mediator must be compassionate and a good listener, while also rising high above the conflict to see the big picture of the negotiation strategies, and higher yet to question whether the present conversation is going to help everyone get to the finish line. The mediator must be calculating and extrapolating the progress of the negotiation numbers, as well as understanding the impact of the non-economic terms that need to be discussed, when to bring those terms into the discussion, and what impact they will have on the negotiation. The mediator must also be mindful of each parties’ big picture – their real life and the rest of their business outside of this case, and when to bring those perspectives into the conversation.
Knowing that this bottom line objection may occur is what occasionally prompts some experienced mediators to keep a key case fact in their back pocket. Holding back a useful piece of information in anticipation of such a moment can help to overcome the, “I need more information” and the, “Knowing what I know now”, and, “The way the case looks to me right now” objections. It is an old adage that people do not change their minds, but given new information, they are free to make a new decision. This is another way of allowing people to save face and back down from that “final offer” statement by helping them have a legitimate reason to move a little further.
Another negotiation impasse that can occur is one I call “Looking Sideways.” This occurs when participants in the negotiation are paying more attention to what another party is getting, than whether an offer is in their own best interest. This frequently occurs when there are multiple parties on one side of the table – either multiple plaintiffs who will divide a settlement in some fashion, or multiple defendants, such as in construction defect and product liability claims where there can be dozens of defendants contributing to a global settlement. In this instance, one co-defendant will stake out a position that is completely dependent on another co-defendant’s offer. For example, one subcontractor will say, “I will pay whatever so-and-so pays, but not a penny more.” Or one co-plaintiff will object to a global settlement offer from the defendant(s) because it provides more money for another co-plaintiff than for them.
Looking sideways can also describe when a defendant becomes more concerned with the windfall to a plaintiff, rather than whether the settlement makes sense for them. This can sometimes be remedied by paying part of a settlement to a third party, such as a non-profit organization.
When parties are looking sideways, instead of at their own best interest, the mediator has to use an “above the fray” perspective to help that party keep their eye on the ball and decide whether their individual share results in a fair settlement to them, without regard for what others are doing. For example, if a single family construction defect case is settling for a global settlement of $300,000, and one subcontractor with mid-sized exposure is contributing $30,000 to the settlement, they can become more focused on whether another mid-sized subcontractor is contributing $25,000 or $35,000. The mediator’s question to them, keeping the big picture in mind, is whether they are satisfied with a contribution of ten cents on the dollar of the global settlement. Chances are that setting the contribution in this context may make it seem fair and make sense to them, allowing them to explain it to others, if necessary.
Threat of impasse can also come about when the parties are writing the terms of the settlement agreement. One reason to be sure to write a settlement agreement at the end of the mediation, even over the parties’ predictable resistance after hours of difficult negotiation, is because the exercise of writing the agreement forces the attorneys, in particular, to focus on the details of the agreement. If a mediator has not inquired in advance about potential deal points such as confidentiality, payment terms, release language and who will be released, then this exercise can be like a ticking time bomb. Too often, deals blow up at the end where all parties think that they have reached agreement, only to find out that when they are tired and wrung out, frustrated and anxious to be done, there is a problem with a deal term.
Problems at this stage of the mediation are generally met with rock-solid positions, ultimatums, and emotional parties ready to walk away from the pending agreement unless they get their way, or “win”, on this newly raised term. Experienced mediators have seen parties ready to walk away from a hard fought, yet fragile settlement over disagreement of a week or two in the time the settlement payment will be made. Emotions run high at this stage in the process, and the mediator owes it to the parties to anticipate this and gently raise and negotiate these deal points along the way, when the parties are still in the middle stage of their negotiation, and there is still a willingness to give-and-take.
In short, if a mediator can anticipate common causes for impasse, such as these, the mediator can help the parties to avoid the potential for impasse all together, and find their way directly to a successful resolution.
Finally, if it sounds like the author has all of the answers to avoiding impasse and settling cases, the fact is that even this mediator only settled 92% of the cases he mediated last year. And all of this learning comes from mediating over 1,000 cases over 12 years, and making every one of these mistakes. Learning, of course, comes from making mistakes and looking back to see, with the benefit of hindsight, what caused it and how to avoid it the next time. Mediators learn by experience – by time in the chair at the head of the table. And hopefully by reading articles that help them avoid such problems by knowing in advance where to look for these bumps in the road. Hopefully, readers will remember the next time they are staring at a situation that looks like a potential impasse, that they are simply not finished yet, and there is more to do. This just means that it is time to dig down deeper into their toolbox and find the right tool.