By Mark Grossman & Scott Van Soye
A cake recipe says to add all of the required ingredients, and then place it in the oven for 45 minutes at 350 degrees. The chef, who is in a rush, takes a shortcut and leaves out an important cooling process and places the cakes in the oven at 400 degrees for 35 minutes, hoping for a good result. Instead, the chef has unhappy customers when the resulting product is not satisfactory in taste and texture.
The attorney has what she and her client believe to be a strong case. She allows the other side to do all the work in discovery but does not do her own and fails to lock down evidence of how her client has been damaged or for the defense of the claims against her client. She and the client “have a number in mind” that the other side will have to meet. However, they can’t or won’t explain how they arrived at this number or provide proof of the damages.
In a distributive bargaining situation, mediators often see counsel that come to the mediation looking for the mediator to, “Get me the money” or “Convince them their claim has little to no value.” When beginning to manage expectations during a mediation, mediators often wonder why parties would choose to waste everyone’s time coming to the mediation unprepared. To a mediator, this shows either that the unprepared party doesn’t know what mediation is, or doesn’t mind wasting a real opportunity to settle her case.
Mediation is not an opportunity to settle the case without groundwork or expense. The process requires that the parties know what they want, and why the case is worth what they expect to get. It also ideally includes some idea of the other party’s strengths and weaknesses – which usually means prior investigation or discovery. Notably, a good mediator can help the parties decide what it is they want, or discuss the outcome of similar cases in terms of settlement value or the outcome at trial. Preparing adequately for mediation requires a significant commitment of time and resources, which could be better devoted to talking directly about settlement.
A mediator is better equipped to push the parties toward settlement if the parties provide some data or information about the value of their case. If a plaintiff says his case is worth X, the mediator will be in a good position to push that number down if there are hard facts casting doubt on liability, even if there is contrary evidence. For example, in an auto accident case where serious injury is claimed, a plaintiff should share with the neutral evidence undermining defendant’s arguments about the slow speed of the vehicles at the time of impact (ideally information or testimony under oath). Again, preparation and discovery are essential, because the mediator starts out with no knowledge of the case – that’s one of the reasons we believe her to be neutral.
Why all this emphasis on developing evidence? Why can’t we just sit down and pick a number together? We could if both sides were perfectly rational, both sides had perfect information, and both sides wanted only money. But we aren’t and we don’t. For example, humans tend to irrationally distrust information that comes from an opponent. Such “reactive devaluation” assumes that what is good for you must be bad for me. Humans (also irrationally) assume without support that our position is correct, that the information, as known to us, supports our case, and that a jury will think as we do. These are phenomena called “naïve realism” and the “false consensus effect.”
Litigants lack perfect information and distrust what is given to them. This makes it harder to settle. Preparing for mediation by doing discovery mitigates this problem. Information developed in verified responses is trusted more because we know that the penalties for lying under penalty of perjury are severe and we expect our opponents to avoid that risk.
Another reason that failing to prepare for mediation can hurt the chances for settlement is that it violates our opponents’ expectations and sends the wrong signal about a case. The litigation process – including mediation or negotiation, to some degree – is seen as rational and competitive. Parties are expected to develop evidence, come up with demands or offers based on that evidence, and make the strongest case possible at the mediation table.